I’m Mary Walden, with economist MW, welcoming you to the economic perspective. Today’s program looks at the impacts of the 2017 tax changes. Mike, the federal tax changes approved at the end of 2017 were some of the largest and most controversial ever. Household and corporate income tax rates were lowered, many deductions were changed, and incentives for investments were added. With two years since the tax overhaul occurred, do we have any conclusions about its results?
Mike: Summary Answer
- Did see grow increase to 3% in 2018, but back to 2% in 2019 – debate – tax impact temporary, or impact of trade war
- Majority of individuals paying a lower effective tax rate
- Corporations also paying less
- Companies initially invested more, but then the bump disappeared
- US companies shifted about $1 trillion from their foreign subsidiaries to the US
- But much of that was used to buy back stocks
- Have seen the annual deficit surge – debate whether most due to lower revenues or increased spending
- As with most tax changes – big debates on impact
- I’m MW
Mary: And I’m Mary Walden for the Economic Perspective, an NC State Extension program from the Department of Agricultural and Resource Economics.