On Taxes - Pt. 8

I have taken a small hiatus from writing about taxes, but I'm back for the next installment in this series. I have simply been responding to the "details" of the latest iteration of GOP plan to afflict the afflicted and comfort the comfortable Tax Reform. If you want to see it, click here.

Anyway, here is the next plank of their plan:

CREATES A NEW LOWER TAX RATE AND STRUCTURE FOR SMALL BUSINESSES 

The framework limits the maximum tax rate for small and family-owned businesses to 25% - significantly lower than the top rate that these businesses pay today. 

Don't get me wrong, some day when I become a partner at my law firm I will gladly take the 25% rate as opposed to the 39% tax rate; I will simply pay myself an annual salary of $1.00 and characterize the remainder of my fees as "law firm profits" as opposed to "wages."

For some reason, I don't think that this is what people are supposed to take away from this.

Furthermore, I don't see any thought to the notion that when the government takes in less money, it has less money to spend on such things as early childhood education (or wars in exotic places). Once the proponents of this plan seriously grapple with the idea of paying for their "reforms," then I will seriously grapple with the idea of taking their "reforms" seriously.

There is no evidence to suggest that this will somehow "unleash" the American economy. However, as they say, it is difficult to get a man (generally, a conservative congressman) to understand something when his salary (or re-election funds) depends on him not understanding the thing. Paul Krugman has a nice writeup on this here. I highly encourage anyone interested in this subject to read what Mr. Krugman (who has won a Nobel Prize in economics . . . something that I, at least, have not done) has to say.