The federal tax proposal is flawed in several ways. Here are a few.
First, the corporate tax cut is 42.8 percent. The proposed cuts would cause a $1.46 trillion shortfall over ten years. That would be replenished by a $1.56 trillion tax increase on working families through the elimination of the $4,050 personal exemption per taxpayer.
Second, the bill discourages charitable donations to churches and nonprofits. By doubling the standard deduction, the bill simplifies tax filing for some but takes away their incentive to file charitable deductions.
Third, eliminating federal deductibility of state taxes means that the income earned to pay the state tax is taxed a second time. For Iowans, this is a tax increase.
Fourth, the estate tax should be increased, not repealed. It only applies now to inheritances above $5 million. The fortune of such a windfall is worth the misfortune of the tax.
Fifth, the money has to come from somewhere. Adding to the deficit is not an option. Until Congress decides where spending would be cut, they should not be allowed to cut taxes. This is like going Christmas shopping on an overspent credit card.
Dan R. Ebener
Editor's note: For years, Ebener has been associated with many non-profit charitable organizations, secular and religious.