As the U.S. gears up for the upcoming presidential election, tax policies have taken the spotlight, with Democratic candidate Kamala Harris and Republican candidate Donald Trump unveiling their contrasting approaches. Harris has pledged to introduce a tax credit for small business start-ups, emphasizing the significance of the small business community in driving economic growth. She has also promised a middle-class tax cut, criticizing Trump for purportedly favoring the wealthy with tax breaks at the expense of the middle class.
In contrast, Trump's tax agenda centers on benefiting the wealthy and industries, with a focus on reducing corporate taxes. Having previously slashed corporate tax rates, Trump is now aiming to further decrease it to 15% if re-elected. Additionally, Trump is promoting a tariff hike on imported goods, particularly targeting Chinese imports with a potential 60% duty increase, in a bid to reduce the import bill and boost domestic production.
The impending tax changes are raising concerns among Americans, facing a looming tax shock in 16 months. The Tax Cuts & Jobs Act (TCJA) implemented during Trump's term saw tax cuts for individuals and industries, but certain benefits are due to expire in 2026, prompting debates on fiscal responsibility due to the estimated deficit impact in the following decade.
Amidst the tax policy rivalry, both candidates are vying for support by offering tax incentives to the gig economy workers, with promises to eliminate tax on tips received for services rendered. This election season underscores the divergent tax visions of the contenders, setting the stage for a significant economic policy choice for American voters.