Larry Kudlow says way to make the rich pay taxes is to lower them
‘Not only will they have investment incentives, they will also have no tax avoidance’
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Your support makes all the difference.A former Donald Trump official who served as an economic adviser in his administration has said that the way to make “upper income” Americans pay taxes is to lower their rates.
In an appearance on Fox News show The Ingraham Angle on Monday, Larry Kudlow discussed reports that Joe Biden is considering the first federal tax hike since 1993.
Mr Kudlow, who served as the director of the National Economics Council under Mr Trump, rejected the idea.
"This business about getting them to pay their fair share, the way to get upper-income people to pay more in taxes is to lower their tax rate,” he said.
He added: “Not only will they have investment incentives, they will also have no tax avoidance. They never tell you that, but the evidence is very clear.”
Mr Kudlow’s views echo traditional Republican tax policy and the theory of the “Laffer curve”, the argument that excessive taxation of the wealthy can, at some point, become self-defeating in respect to raising revenue.
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While some economists claim that we are already at the threshold, others say that rates could, in fact, go much higher.
The former adviser contrasted Mr Biden’s reported proposal hike to Mr Trump’s tax cuts, saying the cuts had in fact benefited primarily people with middle and lower-middle incomes.
“They got more growth in their income and wages by far than the top one per cent,” Mr Kudlow said.
Mr Biden promised during the 2020 campaign to only introduce tax rises for those who brought-in more than $400,000 (£287,000), while revoking a Trump-era tax break for big business.
Bloomberg reported on Monday that four people with knowledge of the Biden administration’s proposals said that other 2020 campaign promises, including a 28 per cent tax for corporations, are also being discussed.
According to the report, analysts believe that tax rises could raise between $2trn (£1.4trn) to $4trn (£2.9trn) within a decade, helping to fund the Biden administration’s proposed spending for infrastructure, climate initiatives and expanded help for poorer Americans.
A CBS-YouGov poll released on Sunday suggested that 60 per cent of Americans say they support the US president’s handling of the economy.
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