Keep in mind also that the political forces supporting the status quo are very strong and already organizing to keep existing deductions and exclusions, and even expand them.
Since the largest benefits from rate reduction would go to upper-income taxpayers, they will also bear the burdens of "base broadening" reductions in existing deductions needed to keep the government from hemorrhaging revenue, he explained.
When faced with the question of how to best address the disparity, Congress didn't tinker with rates, existing deductions or credits.
With almost all existing deductions and tax credits to be abolished under the plan, there wouldn't be any way for people to get around these taxes.
You know what you're doing". Of the 13 Republicans who broke with their colleagues to oppose the bill, most did so because they believed it would actually raise taxes on many of their constituents because of the elimination of many popular existing deductions and credits.
The deal retains the Bush-era tax cuts and almost all existing deductions and tax breaks, except for a few changes affecting a sliver of high-income Americans, generally defined as those with taxable income above $450,000, and even they did not fare badly (their new top rate of 39.6 percent is still among the lowest top rates in the 100-year history of the income tax).
Additionally, a Universal Savings Credit, which would replace all existing deductions with a new flat tax credit based on their contributions to a savings account, would flip the upside-down pyramid of tax benefits to better help low- and middle-income families save for retirement". The problem isn't that Americans don't have enough ways to save for retirement -- they have too many.
Other big-ticket items are continuing the research and development tax credit for businesses, allowing small businesses to write off investments, a deduction for state and local sales taxes for residents of states without income taxes, and extending an existing tax deduction for education tuition.
