What is wealthy? Tax reform plan could tap high earners to pay more
Former Republican presidential candidate Carly Fiorina on efforts to achieve tax reform and its potential impact on the economy.
As top Democrats and Republicans clash over whether President Trump’s overhaul of the tax system will include tax cuts for wealthy Americans, former GOP presidential candidate Carly Fiorina pointed out Thursday that “wealthy” can be a relative term.
“What’s a high earner? If you’re a couple in Manhattan with a couple of kids and you make $250,000, you’re a high earner, but maybe you don’t feel like a high earner,” Fiorina said during an appearance on FOX Business Network’s “Mornings with Maria.”
Top Republican lawmakers, including Texas Senator Ted Cruz, are pushing to cut taxes and simplify the tax code. GOP leaders are expected to roll out their tax reform plan within weeks, and House Speaker Paul Ryan (R-WI) has said that he is aiming to finalize a new plan by the end of the year.
However, Democratic leaders oppose any tax cuts for high earners. A letter signed by 45 of 48 Senate Democrats declared that they were willing to pursue a bipartisan reform of the tax code – under the condition that the plan does not include tax cuts for the wealthiest Americans.
Critics argue that the wealthy carry an undue burden in the current tax system. Earlier this year, the Tax Foundation noted that the top 1% of the country’s earners paid a larger portion of individual income taxes (39.5%) than the bottom 90% of earners combined (29.1%).
“[For] the top 10% of taxpayers, the last dollar of income is $133,000. That’s union workers, that’s middle America,” said Mitch Roschelle, a partner at accounting firm PricewaterhouseCoopers.
As debates on tax reform intensify, Trump has shown a willingness to negotiate with congressional leaders from both sides of the aisle. The president held a bipartisan meeting with moderate lawmakers on Wednesday and later scheduled a private dinner with Democratic leaders Charles Schumer (D-NY) and Nancy Pelosi (D-CA).
After the bipartisan meeting, Trump warned that taxes could actually rise for the wealthiest Americans under the new plan.
“If they have to go higher, they’ll go higher, frankly,” Trump told reporters, according to USA Today.
Cruz, who advocates for a low, flat tax rate, laid out his plan for reform on “Morning with Maria.”
“Everyone should pay the same low rate for a fairer tax code,” Cruz wrote on Twitter this week.