House GOP Tax Reform Blueprint

In June 2016, the House Republicans released a tax reform plan. The plan would reform the individual income tax code by lowering marginal tax rates on wage, investment, and business income; broaden the tax base; and simplify the tax code. The plan would also lower the corporate income tax rate to 20 percent and convert it into a destination-based cash-flow tax. Finally, the plan would eliminate federal estate and gift taxes.

Our analysis finds that the House Republican tax plan would reduce federal tax revenue by $2.4 trillion over the next decade. The plan would reduce marginal tax rates on labor and substantially reduce marginal tax rates on investment. As a result, we estimate that the plan would boost long-run GDP by 9.1 percent. The larger economy would translate into 7.7 percent higher wages and result in 1.7 million more full-time equivalent jobs. Due to the larger economy and the broader tax base, the plan would reduce revenue on a dynamic basis by $191 billion over the next decade.


Featured Research

Interest Deductibility – Issues and Reforms

May 4, 2017

Why Full Expensing Encourages More Investment than A Corporate Rate Cut

May 3, 2017

Federal Tax Reform: The Impact on States

March 8, 2017

Understanding the House GOP’s Border Adjustment

February 15, 2017

FAQs about the Border Adjustment

January 30, 2017

Exchange Rates and the Border Adjustment

December 15, 2016


Related Articles

Tax Treatment of Structures Under Expensing

May 24, 2017

How the Border Adjustment Helps Fix Business Taxation in the United States

May 23, 2017

Will Today’s Hearing Portray the Border Adjustment as a Trade Policy or a Tax Policy?

May 23, 2017

Takeaways from Initial House Ways and Means Tax Reform Hearing

May 19, 2017

Ted Olson Misses the Mark on Analysis of DBCFT Constitutionality

May 4, 2017

Interest Deductibility – Issues and Reforms

May 4, 2017

Why Full Expensing Encourages More Investment than A Corporate Rate Cut

May 3, 2017

The Business Tax Relief and State-by-State Effects of the House GOP Blueprint

April 12, 2017

The Effect of the House GOP Blueprint on the Price of Domestic Goods

April 12, 2017

The State-by-State Impact on Jobs and Family Incomes of the House GOP Blueprint

April 11, 2017

How a Destination-Based Tax System Reduces Tax Avoidance

April 4, 2017

Lessons from Australia’s GST Implementation for Considering the U.S. Border Adjustment

March 31, 2017

The Effect of the House GOP Blueprint for Tax Reform on the Exchange Rate of the Dollar

March 31, 2017

Federal Tax Reform: The Impact on States

March 8, 2017

Is Trump Supporting a Border Adjustment for the Wrong Reason?

March 2, 2017

What to Look for in President Trump’s Speech to Congress

February 28, 2017

Border Adjustments, Currency Adjustments, and the Value of the U.S. Dollar

February 16, 2017

Understanding the House GOP’s Border Adjustment

February 15, 2017

Grading the House GOP Blueprint with the International Tax Competitiveness Index

February 14, 2017

Comparing the Static and Dynamic Effects of Tax Reform on After-Tax Incomes

February 13, 2017