Democrats would reverse some tax cuts to fund infrastructure

It’s their chief legislative accomplishment since Trump became president, and Congress has not announced plans to consider the president’s infrastructure plan.

Americans had initially been cool to the $1.5 trillion GOP tax cut bill, which Republicans say will pay for itself with economic growth and Democrats warn will pile onto deficits. But it has gained favour since becoming law late last year. Some workers are seeing increased take-home pay, and some companies have granted bonuses or wage hikes.

Senate Majority Leader Mitch McConnell dismissed the proposal, and said it’s too bad Democrats voted against the tax plan, as its benefits are “percolating through every corner of our economy.”

“Repeal all these bonuses, pay raises, new jobs, and new investments?” McConnell said. “Talk about a non-starter.”

Trump’s infrastructure proposal has seen less interest in Congress. It relies mostly on private and local government funding, with about $200 billion in federal investment.

Democrats warn that the president’s proposal would result in “Trump tolls” to pay for new roads, bridges and other infrastructure across the nation.

“We have a much better plan,” Schumer said.

Democrats would generate revenue for their $1.022 trillion infrastructure plan by reversing some of the tax cuts.

They would reinstate the top income tax rate of 39.6 per cent on the highest-earning households, couples earning more than $600,000 a year, up from 37 per cent under the GOP tax cuts bill.

The corporate rate, which was slashed from 35 per cent to 21 per cent under the GOP plan, would climb back to 25 per cent under the Democratic proposal.

Among other changes, the Democrats would restore the estate tax exemption at $11 million for couples, rather than double that, as became law under the GOP bill, and revive the alternative minimum tax. It would also eliminate the so-called carried interest loophole, which was left in place in the GOP bill and allows some investment managers to have their income taxed at lower rates.

Democrats would put the fresh revenue to work making improvements to traditional infrastructure — roads, bridges, water and sewer systems — as well as new more modern investments in rural broadband, schools and airports.

Lisa Mascaro, The Associated Press

by Canadian Press

Democrats would reverse some tax cuts to fund infrastructure

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