Why a Firm Believer in Tax Cuts Could Derail the Senate Tax Cut Plan

GURPS

INGSOC
PREMO Member
What Mr. Johnson needs, he said in an interview from Wisconsin on Friday, is for the bill to treat more favorably small businesses and other so-called pass-through entities — businesses whose profits are distributed to their owners and taxed at rates for individuals. Such entities, including Mr. Johnson’s family-run plastics manufacturing business, account for more than half of the nation’s business income, and the senator says the tax bill would give an unfair advantage to larger corporations.

“I just have in my heart a real affinity for these owner-operated pass-throughs,” he said. “We need to make American businesses competitive — they’re not right now. But in making businesses competitive, we can’t leave behind the pass-throughs.”

The sudden fissure between longtime allies laid bare the challenge that Republicans face as the tax bill leaves Mr. Ryan’s care and navigates the rough waters of the Senate, where different priorities within the party could sink the bill if not adequately addressed.


Why a Firm Believer in Tax Cuts Could Derail the Senate Tax Cut Plan
 

Gilligan

#*! boat!
PREMO Member
I hope he gets some of what he's pushing for. :fingerscrossed: I was pretty disappointed in the bill so far...
 

Rommey

Well-Known Member
I guess I don't understand how the pass through part of the business works...I mean I understand the concept but maybe I'm missing why the business isn't treated as a business and paying taxes as a business and the owners are paid as individuals and paying taxes as individuals. If the salaries of the owners were a business deduction affecting the business taxable income, then why would that be any different than the corporations? Is it too easy to "hide" legitimate income from taxation?

What if S-Corps/LLC et. al. were taxed in their own hybrid category where owners income and the business income were taxed at a flat rate lower than the corporate rate.
 

Starman

New Member
The article said:
Since winning re-election in 2016, he has not shied from voicing displeasure with the Republican leadership. He was an early and vocal critic of the party’s legislation to replace the Affordable Care Act, though he ultimately voted in favor of the bill.

And he'll vote for this too. The bill will pass unless there are far more GOP "nays" than are letting on.

My guess is that Johnson is just looking for concessions of some sort.
 
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