by Semoon Chang
How taxation is structured greatly influences economic activities, because economic agents change their behavior in response to incentives provided by the tax system. In today’s article, I will review proposed changes in U.S. tax system by the two U.S. presidential candidates, with special reference to their impact on the overall economy. Some proposals will have little, if any, impact on the economy. For example, Trump proposes lowering marginal tax rate on earned income to 12 percentfor low to middle income individuals, while Clinton offers little change on them. These proposals will have an impact on some individuals, but no significant impact on the overall economy. Approximately half of low to middle income individuals pay little, if any, income tax to begin with.
Source: Tax proposals: Clinton vs. Trump