President Donald Trump and Republican lawmakers were quick to praise the GOP tax bill shortly after its passage on Wednesday. The president seemed almost giddy, and it's not hard to see why. A new study shows that Trump saves up to $15 million in the tax plan. His family is set to save even more.
According to a study by the progressive organization the Center for American Progress (CAP), the president will likely save millions from the GOP tax bill. The think tank crunched the numbers and found that Trump will get a tax cut of an estimated $11 million to $15 million each year thanks to new rules on pass through corporations.
The way this works is that instead of being taxed at the corporate rate, many companies are "pass-through businesses," which means their earnings are passed through to the owner. Under the current tax law, the owner pays personal income tax on the money that is "passed through" up to the old highest bracket of 39.6 percent. The GOP tax bill lowers that rate — even under the new, reduced highest bracket for individuals — to 29.6 percent. For Trump, it's a windfall.
That's not the only way his family would benefit. The changes to the estate tax would save Trump's heirs about $4.5 million. The CAP didn't break down numbers for his children's income, but they did take a look at Jared Kushner, Trump's son-in-law and senior adviser. According to its estimate, Kushner could also save anywhere from $5 to $12 million.
Seth Hanlon, a senior fellow at CAP, told The Guardian pointed out last-minute additions that benefit the real estate industry show "the extent of the self-dealing." The pass through tax breaks tend to benefit real estate holders, and its initial inclusion was dubbed the #CorkerKickback on Twitter, because the GOP senator and real estate investor Bob Corker changed his vote after the provision's inclusion. Trump wins big, Hanlon said:
There is no doubt that Trump is getting major new tax cuts from this bill – at the same time as it preserves special loopholes, like the deductions Trump reportedly takes on his golf courses. These are just one illustration of the venality and corruption behind this bill.
Trump and his family are not alone in benefitting. The study showed that other members of his administration are set to see a reduced tax bill too. The reduction on the highest tax bracket will affect much of his cabinet, the wealthiest in history. The families of Betsy DeVos, Education Secretary; Linda McMahon, administrator of the Small Business Administration; Steven Mnuchin, Treasury Secretary; Wilbur Ross, the Commerce Secretary; and Rex Tillerson, the Secretary of State, will benefit from the estate tax changes, too.
The GOP have suggested that the bill is for the middle class, but TJ Helmstetter, Americans For Tax Fairness's communications director, disagreed. "When all is said and done, over 80% of the tax cuts will wind up in the pockets of the top 1%. Meanwhile, all of this will be paid for by the middle class and families who are struggling to get by,” he told The Guardian. Helmstetter called the bill a "money grab by the ultra wealthy," not tax reform.
Those critiques don't seem to have Republicans on the defensive, though. Quite the opposite, in fact. "This has been a year of extraordinary accomplishment for the Trump administration," Senate Majority Leader Mitch McConnell crowed Wednesday, along with dozens of others who praised Trump's role in making the tax plan pass. But perhaps it wasn't so much an accomplishment for the administration as it was for Trump's own pocketbook.