Would American households really see an average income increase of $4,000 a year if President Donald Trump succeeds in cutting the corporate income tax? Don’t count on it. This claim is dubious at best.
In promoting his plan to overhaul of the nation’s tax system, President Donald Trump claimed “the rich will not be gaining at all with this plan.” But the tax proposal his administration outlined in April would heavily benefit high-income taxpayers, and Trump hasn’t revealed any changes to it.
In advocating for a corporate tax cut, Treasury Secretary Steve Mnuchin overstates the consensus when he says “most economists believe that over 70 percent of corporate taxes are paid for by the workers.”
Sen. Bernie Sanders frequently says corporate income tax receipts have dropped from more than 30 percent of federal revenue in the 1950s to only 11 percent in 2015, leaving the impression that favorable tax policies are the reason. But there are several factors behind that drop.
Chris Christie repeatedly has said that U.S. corporations are taxed twice on income earned abroad, claiming in one speech that IRS officials “don’t recognize the tax that you paid to a foreign country.” That’s false.