Trump’s tax bonanza

So far Mr Trump has got into the race and stayed in it largely by dealing with the darker issues of crime, terrorism and migration. The US and EU establishments dislike his rhetoric associating crime with migration and his policy of a border fence or wall with Mexico.

Mr Trump does have a more positive side. His tax plans are for a major tax cut for America. He proposes that no-one on an income below $25,000 should pay any tax. He recommends just 4 bands of tax at zero, 10%, 20% with a top rate of just 25%, making US personal income tax very attractive by advanced world standards. He wants to see a single 15% rate of profits tax for all businesses, with a one off lower rate to get US corporations to repatriate and profit and  cash sitting offshore. He would abolish the death tax.

These proposals gained only a passing reference in his Acceptance speech at the Republican Convention. If he starts to market these ideas more widely they could prove very appealing to many Americans. His tactic appears to  be to detach worried low and middle income democrats to his cause by offering policies to boost their incomes and lower their tax bills. We know that  many of them are not enamoured of Mrs Clinton, as they showed by their support for Mr Sanders in the primaries.

Mr Trump is also attacking head on the past US establishment’s policy of military intervention in the Middle East. Whilst he is not an isolationist, he may well find a fertile political territory of people who resent the loss of life and the money expended on foreign wars, when there is little settled democratic government in the affected areas to show for them.


  1. Nig l
    July 24, 2016

    Your 2015 manifesto attacked Labour for a tax and spend approach and what did Osborne do, precisely that, increasing personal allowances yes, albeit very modestly but almost freezing the 20% band pushing vast swathes of people into the 40% bracket, so much for your support of hardworking people. His latest attack was George Brown like, taxing dividend income. The tax was already paid hence the tax credit, the shares were bought out of taxed income and now he is taking another slice. You have renagued on you promise to raise the death tax limit to £1m. It could have been Tony Blair as PM.

    Looks as if Trump is promising similar to what you did in 2015. I wonder, if elected, he will let many of his voters, down?

    We see lots of talk about reducing Corporation Tax, spending our EU contribution on the NHS et. In his Autumn statement, Hammond should start to meet the 2015 manifesto commitment and acknowledge the contribution prudent savers make and stop treating them and the ‘middle class’ as milch cows.

    Reply Yes, we have a new government committed to the 2015 Manifesto.

    1. Leslie Singleton
      July 24, 2016

      Dear John–Eh? Who says (apart from you just now) that the new government is committed to the 2015 Manifesto?? I must be reading watching and listening to the wrong papers and programmes because I have not heard any such assertion–not that it would mean much if I had.

      Reply The PM has assured us of that

      1. Hope
        July 24, 2016

        No she has not.nshe has abandoned your party’s pledge to balance the structural deficit, promised to be achieved last year. She has stated she wants ECHR to continue, where is this in your manifesto?

        Border controls are a joke. Look at Dover, if the queues arose because every car and passport is checked what were they doing before? Is this not what they should be doing? If not, how insecure our borders are and have been contrary to May’s false claims about border controls! Are there queues from the other direction? Again, if not why not?

        Media hype of increasing punishment for hate crime linked to the EU referendum. Is there a link? Should we link atrocities and cover ups such as Rotherham to remain? Still no serious public inquiry why vulnerable white girls were targeted and why the state authorities failed to protect and investigate properly.btheybwould not even admit it was race crime when distinct groups were involved as victims and offenders. Where is the call for additional punishment?nanynstatement from Rudd due?

      2. Brian Tomkinson
        July 24, 2016

        Reply to reply,
        Elimination of budget deficit by end of this Parliament has been abandoned already.

    2. Lifelogic
      July 24, 2016

      The PM has assured us has she. So we should at least get the £1 million inheritance promises rather than Osborne’s complex, ratting, fake, fig leaf botch?

      Lower simpler taxes and undo nearly everything Osborne has done that is the way to go. His absurdly high stamp duties, his endless increases in landlord tenant taxes, his pension tax grab, his 10% insurance premium tax, his absurd energy and land fill taxes, the bonkers climate change act, the counterproductive attacks on non domes, his bonkers sugar tax …

      His absurd GAAR tax is hugely damaging. A sort of pay what we say mate (after the event) tax in the Mugabe mode. Hugely damaging to investment due to the uncertainty.

      1. Lifelogic
        July 24, 2016

        The Tory manifesto says:

        Cutting taxes, making welfare fairer and controlling immigration.

        The best Schools and hospital for you and you family.

        Helping you buy a home of you own.

        So if Theresa May is actually going to do this it will be a complete U turn from the Cameron/Osborne actual actions with their endless tax increases, dire deteriorating public services, new taxes and red tape on housing provision and open door immigration regardless of merit or needs.

        Reply I look forward to Mrs May being a good custodian of the promises.

        1. Nick
          July 24, 2016

          They won’t.

          They have that debt that can’t be mentioned to pay.

          Look at state spending. 30% and rising is going on paying debts.

          The lack of assets for the state pension means its such poor value, that most people need welfare to survive. That pushes up state spending and taxation.

          That’s why John Redwood and any politician will not quantify the debt according to any of the accounting standards.

          The first party/MP to quantify the debt gets the blame, so he’ll keep quite.

          If you want to know its 10 trillion and rising fast. Osbourne cut 2 trillion from the value of state pensions for example. Not that’s made any difference. It’s increases by 2 trillion in the interim.

          It’s far worse. It’s the direct cause of wealth inequality. The result is that at some point you get a real kleptomaniac government like Corbyn. Far from protecting the public from such governments, the Conservative’s decision to hide the debt in 2005, results in the problem getting worse.

          If you look at the value of state pension plus debts, against a back test of what Mr Median could have had if his NI had been invested, he is down over a million pounds if they had just retired.

          So not a hope in hell of May making good.

          Reply I have quantified the debts, as you well know, including the capitalised cost of the pay as you go State pension

        2. Lifelogic
          July 24, 2016

          I very much hope so, we shall see.

          Smaller but efficient government (doing only what government really can do better than individuals and businesses can), lower simpler taxes, cheap energy and a bonfire of red tape.

          A government that provides services that people actually want, rather than one that just thinks of new ways to mug or inconvenience them. Perhaps one that can even run the odd public loo that has not been closed down!

          That is the sensible way to go. But May is often wittering on about things like workers and customers in boardrooms and the “equality” agenda. Where does she stand on Cameron’s green crap expensive energy lunacy that has caused such pointless harm to UK industry?

          Millions are struggling to get GP appointments or registered and the NHS is falling to pieces with fines for non performance now dropped. This as almost non are actually performing competently and hitting targets (the minimal targets) for waiting times and the likes I suspect.

        3. graham1946
          July 24, 2016

          Mrs. May could do it.

          What I found amusing was her praise of Cameron as a ‘great modern PM’ in her Downing Street inaugural speech, then going on to knock just about everything he stood for and did apart from Gay Marriage.
          She also supports the ludicrous Foreign Aid budget which just sprays money everywhere for the sake of achieving a target, whilst her own country falls to pieces and people here rely on food banks. Not much to look forward to there, coupled with the dithering over Brexit, I fear the SPADS and Civil Service will do for her as they do for all PM’s with good intentions to start with and not achieving much by the end.

          Anyway I’m willing to give her a chance and hope for the best. The first Autumn statement will give us a steer on how her government is going to go, although the appointment of the richest man in politics as Chancellor does not give much hope for understanding of the ‘ordinary person’s’ position and struggle in life which she says she knows about and wants to help. We’ll see.

          1. Lifelogic
            July 24, 2016

            I too am willing to give her a chance and hope for the best (even if she is a Geography graduate).

            It will be clear very quickly if she is another wrong’un in the Heath. Major, Cameron and Osborne mode. I suspect she is alas, but lets give her a chance.

          2. Wireworm
            July 25, 2016

            It’s tragic that she fell out with Gove because, as far as I can see, there’s little to distinguish them politically. He could have stayed in post or even had a new role overseeing policy implementation across departments. He would also of course have been a powerful influence in Cabinet on the subject of Brexit. Let’s just hope that, after hanging him out to dry for a spell, she brings him back.

    3. Lifelogic
      July 24, 2016

      More tax borrow and waste with Osborne rather than spend. No one can thing things like HS2 are sensible can they?

      The real demand is for better roads. Especially as new auto driving technology comes along. People and goods want to go door to door in the main not from A to B to C to D with endless stops and diversions on route.

      Simpler ticketing, simpler fare structures and better/more ticket machines at stations would save far more time than HS2 and cost perhaps just 3% of HS2.

      1. Caterpillar
        July 24, 2016


        You are right “No one can think things like HS2 are sensible”. Of course HS2 itself is sensible, but things with like spend might not be. It would be possible to spend the same amount on Cross Rail 2 + Heathrow 3, clearly this like spend is more of the same London focus, no rebalancing. Another example, the same investment as HS2 is 4 or 5 years UK overseas aid budget – some would argue this like spend. For 10 years overseas aid you could get HS2, Cross Rail 2 and Heathrow 3 (or vice versa).

        HS2 needs to move from conversation to more actual action, the sooner the better.

      2. Leslie Singleton
        July 24, 2016

        Dear Lifelogic–Now if the basic premise made sense–I mean Scotland to Madrid or Marseilles or Milan or whatever–that would at least make some sense. The idea that Camden is too crowded to have HS2 connect to HS1, when they should be the same thing, is barking mad. A short spur in to London on the old Grand Central and job done. As planned you would think that everybody lived within walking distance of Euston. Given that one has to get to Euston one might as well get to Watford or somesuch. How many billions have these geniuses spent on this already?

        1. stred
          July 25, 2016

          The transfer from St Pancras/Kings Cross to Euston will take longer than the time saved on the journey to Birmingham. Originally the HS1 was to come underground and link, but politicians wanted to develop the old station as a conservation project. How long before they have to announce a speed reduction on HS2 in order to keep cost and energy under control? A truly British farce.

      3. fedupsoutherner
        July 24, 2016

        Lifelogic. I am so glad you brought up the subject of HS2 and roads. Twice now travelling back from Sussex to Ayrshire the journey which should take around 8 hours has taken us over 12 due to accidents, roadworks etc on the M6. There are loads of roadworks with nothing going on for miles on end. We don’t need HS2 which will only serve a very small percentage of people. We need more motorways. Cars are a way of life as are lorries. We cannot do without them. Our roads are not fit for purpose. We had to divert into Shropshire and through north Wales to meet up with the M6 further north. A waste of time on a very hot day. Too many people and not enough roads. We cannot keep taking in more people without more transport links.

  2. Richard1
    July 24, 2016

    Unfortunately it seems unlikely that Mrs May and Mr Hammomd will go for radical tax simplification and flatter rates in such a way as to boost confidence by making the UK dramatically the most attractive tax regime in Europe (maybe along with Switzerland). But it’s early days so let’s see. It would be interesting to see sub policies implemented in the US, I suspect they would be very positive for the US economy, as they have been wherever else they have been tried.

    But Some of the rhetoric coming out of the US Republicans is absurd. newt Gringrich said the other day that perhaps the US would not stand by its NATO obligations to defend Estonia as Estonia is ‘practically a suburb of St Petersburg’. I cannot imagine a more foolish remark by a prominent US politician. Mrs May should clarify that the UK will certainly stand by its NATO obligations and would call on other NATO members, including the US, to do so.

    1. Lifelogic
      July 24, 2016

      Radical tax simplification and tax reductions are the way to go. Perhaps Hammond and May will actually realise this. You can get more tax out of a booming economy. A sounds economy should this be the first priority, one that welcomes the hard working, inward investment and the wealthy. Not one that makes them leave.

    2. hefner
      July 24, 2016

      The Independent, 7 September 1995: JR goes and meet Newt Gingrich for discusions…

      reply Indeed I did. He was Speaker of the House at the time! That does not make responsible for all his views!

      1. hefner
        July 24, 2016

        By the way, did JR go and visit the subsequent Speakers of the House?

    3. formula57
      July 24, 2016

      Recall Mr Trump has said faced with coming to the aid of an attacked NATO member, he would first check such member had “fulfilled their obligations to us”.

      In that light, perhaps any affirmation by Mrs May of the UK’s commitment to meeting its NATO obligations should include the words “excluding Belgium” given the apparent hostility of that country to the UK in the context of agreeing the terms of Brexit. I would certainly welcome that.

  3. eeyore
    July 24, 2016

    These look very competitive tax rates. I like to see healthy competition between governments. How else can efficiency be promoted? And why is price-fixing between companies a bad thing called collusion, but between governments a good thing called harmonisation?

    If, under the benign tax regime of a wise and solicitous President Trump, the world’s rich flood west, Britain and Europe will be left with the world’s poor. The sound of pips squeaking will then be a harmony we’ll hear all too much of.

    1. Lifelogic
      July 24, 2016

      The EU was largely about reducing fiscal and other competition between governments so they could be as bloated and incompetent and indeed as dishonest as they wanted.

  4. Antisthenes
    July 24, 2016

    Who the USA chooses for their next president will have far reaching consequences for us all and they are not spoilt for choice when it comes to candidates. Clinton corrupt and incompetent but then the USA has elected plenty of those before. However in her I doubt any have been that bad. Apart from which her politics is just continuity Obama and as he will be leaving America in a much worse state than when he stared all she can do is finish the job. Crime up, race relations the worst they have been for a long time, debt spiralling out of control, foreign policy that favours enemies over friends, and progessiveness firmly entrenched. Hard to see how she can do any worse but she will.

    Trump’s ideas on trade are right out of the economic comic book. If he does what he says then a lot of the worlds trade will grind to a halt as protectionism will be the name of the game. Apart from that who knows as you say some off his ideas show promise. Best that can be said of him he is not Clinton.

  5. Caterpillar
    July 24, 2016

    Yes, interesting tax policies, though still within existing paradigm.

    [A different paradigm might be (i) private sector doesn’t create money, (ii) progressive expenditure tax not income tax, (iii) basic guaranteed incomes.]

  6. agricola
    July 24, 2016

    There is every possibility that there is more to Donald Trump than the media allows credit for. You do not have the level of business success that he has achieved without a modest level of talent. If only our legislators could achieve approaching the same levels. Within the UK there is a considerable market for the sort of proposals that he advocates for the USA, but I do not see anyone on the political horrizon who is capable of driving them through. We will falter through lack of vision and lack of resolution as usual. Why, you should ask yourselves, is most of the UKs talent base outside the political classes.

    1. eeyore
      July 24, 2016

      Mr Trump attracts much derision but one of his talents deserves notice: he appears to be a strikingly competent mob orator. His voice is very distinctive and carrying, his phrasing and modulation are masterly. He may be the best at the game since the awe-inspiring Dr Paisley. As a communicator able to reach and play an audience, is he up there with Ronnie Reagan?

    2. Antisthenes
      July 24, 2016

      “Why, you should ask yourselves, is most of the UKs talent base outside the political classes.”

      The saying goes ” those that can do and those who cannot teach” I suspect there is an aspect of that when it comes to politics. Certainly on the left they are a motley lot; losers and clueless whingers most of them. The Conservatives now that George and Dave have gone albeit to the back benches I believe we can say that many are talented and dedicated people. At least that is how I see it but then I can only observe what I see on the benches of the commons and Labour , SNP and the like appear a ghastly lot so Conservatives MPs may be not that good but certainly better than the others.

  7. The Active Citizen
    July 24, 2016

    “If he starts to market these ideas more widely they could prove very appealing to many Americans.”

    One aspect of American culture came back to me some days ago when discussing our Leave victory and the profoundly negative response to it from so many who think themselves part of some kind of elite in the UK.

    Overall in the US there’s a tendency towards approval of enterprise. As an example, this is expressed in the support from friends when starting a new business, and even continued support if a person’s first attempt fails.

    So many of our soi-pensant elites are ready to damn initiatives with faint praise whilst secretly hoping they’ll fail, or often to criticise from the outset. In the US, the automatic response is so often the opposite of this.

    Those in Government and the Civil Service who will be responsible for negotiations with the EU could do a lot worse than sprinkle a little American confidence, enthusiasm and chutzpah on their free-trade muesli before starting work each day.

  8. Jerry
    July 24, 2016

    “These proposals [to slash taxes] gained only a passing reference in his Acceptance speech at the Republican Convention. If he starts to market these ideas more widely they could prove very appealing to many Americans. “

    Mr Trump and his advisor’s are highly intelligent people, the later well versed in what makes the American people get out and vote (a specific way), so if boasting that as presentment he will give a massive income tax cut to the wealthy and a small tax cut to the poor (which is what taxes based on percentages of income always do) then I suspect they would have dealt the card at or even before the convention – and whilst it is true that Sanders also wanted tax cuts he did not want them to overly benefit the rich. Trump’s full tax plans would be a hard sell to those disaffected would-be democratic voters (never mind Bernie Sanders supporters) who will not vote for Clinton but might be tempted to vote Trump as the non-politico outsider candidate, the anyone but Hillary mind-set, voters who the Trump campaign have to go after (and have said that they want to get ex Sanders supporters on side especially, stated quite openly from the platform at the RNC.).

  9. alan jutson
    July 24, 2016

    Trump may well win !

    I can certainly see why many Americans would want to vote for him, given the record of many Presidents past, and given that many feel disenfranchised from the present system where career politicians have talked the talk but have failed to walk the walk.

    Trumps problems are his past comments, and proving that his promises on tax cuts and significant spending, will actually add up.

    Certainly he seems to be getting more people engaged in politics, who had previously given up all hope of politicians actually working for them and their Country.

    In effect he is changing attitudes, but within an established Party.

    Rather akin to having Mr Farage as leader of the Conservative Party.

    1. Jerry
      July 24, 2016

      @alan jutson; Oh dear, and you were doing so well until your last line!

      But I agree with the bulk of your comment, and just to add, do not forget the VP running mate, Gov. Pence. Mr Trump appears to have picked someone who will not only act as a balance to his own brashness but significantly add to the Trump manifesto. Good supporting RNC speech by Newt Gingrich too.

    2. Antisthenes
      July 24, 2016

      I like your last remark. As much as I admire Nigel I do believe he would be a disaster as a Conservative PM. So your analogy is probably apt.

  10. William Long
    July 24, 2016

    We need above anything a Chancellor with his own ideas, a real interest in the job, a vision of how to simplify the tax system and the full backing of the Prime Minister; someone who will not be a pawn in the hands of Treasury officials, with whom Osborne was clearly pleased to tag along in the Brownite agenda. Is there any evidence that Mr Hammond meets this requirement? I have heard nothing that convinces me so far but will give him the benefit of the doubt until his Autumn statement.
    As for Mr Trump, underneath the disadvantages of his appearance and his rhetoric there does seem to be some good sense, not least the tax proposals you highlight. I also think his comments on NATO are entirely reasonable: all members of the club should pay their proper subscriptions. From his post Brexit comments he could be a good friend to us; I have heard nothing to make me think that is particularly true of Mrs Clinton. I just hope that Trump can maintain the momentum of his campaign.

  11. Ed Mahony
    July 24, 2016

    Trump also made a great comment that Brexiteers would do well to listen to: ‘bad trade deals cost jobs.’ Yes, countries outside the EU very much want to trade with us but it’s not because they want us to have easy access to their markets but for them to have easy access to ours. And so yes, if we create bad trade deals that will lead to greater unemployment in this country (because they’ll be able to sell cheaper or whatever). Problem is we don’t have anyone trained to negotiate trade deals for the UK at the moment (they’ve been working for the EU). And it takes years to train people up and at some cost (with those we’re going to negotiate trade deals with already with their own experienced negotiating teams).
    Trade deals are incredibly complicated anyway. Add to that, our leading negotiator with the EU, David Davis, thought that until May this year, the UK, outside the EU, could negotiate bilateral trade agreements with Germany (?!) He wrote this in a tweet (don’t believe me, just do a Google search). But my point isn’t David Davis or we don’t have negotiators at moment, but how countries outside the EU will be trying their hardest to get easy access to our markets, and that if we don’t play it right, the trade deals could, in Trump’s words, ‘cost us jobs.’

  12. Jack
    July 24, 2016

    Raising the personal allowance here in the UK has provided moderate fiscal stimulus and kept the deficit large enough for mild to moderate growth rates.

    But we need something more radical, too. Payroll tax cuts would allow people to take home more of their pay packets with instant effect on the economy. It’s what the United States did when Obama first came in in 2009.

    They chose prosperity not austerity and expanded their fiscal deficit (though in my view they should have gone further) rather than try to cut it, and look how much better they did than EU countries.

  13. ian
    July 24, 2016

    There is not the intelligence around to deal with taxes, the labour chancellor and wet & mad put vat up and down about 5 time and settle on 20%, the new one want to put it down to 17.5 and how long will that last, even if it last to the next election might a new government come in with other ideas and how will he make up for the short fall of about 1/8 cut of 110 billion, its well over 10 billion, hope they buy more or take out another loan with the savings but by time the money gone though the companies books, your going come out with short fall.
    Also he want to cut companies tax to 17% to try and get more companies to pay there tax hear, he will be luck to get any extra tax out of that by the time the accountants have been at work on the books, it just a race to the bottom on countries tax rates.

    Then talk about lowering working taxes rates, take a little off hear put a little on there, it all a no sum game, might get little bit more tax in or have to borrow more for the short fall, all sounds wonderful but at the of the day the bills have to be paid, just looking for headlines in the news at the end of the day.

    As i have told you before that i have wrote in and told them how to do it but they throw it in the waste paper bin, like i tell you they have not got the intelligence, I have wrote on this site about the lorry super bot highway using the HS2 route and adding to it, min cost and hit climate change targets 8 year before 2030 with big saving for companies and chance to open up new tec companies remove most of the lorry traffic off the roads and making a lot more room for cars and reduce traffic jams and make it easy to bring bot car on to m ways, never got a airing on this site , another one for the waste bin.

    I am not bothering with any more ideas, iam just going to let them get on with it.

  14. acorn
    July 24, 2016

    Remember that Trump sets federal taxes which are about 18% of US GDP. State and Local taxes together collect another 18% of GDP, 36% in total. The bottom half of the population rarely have to pay federal income tax. Trump’s tax plan sounds good to me, as long as he doesn’t cut federal spending by $1,200 billion a year to make it revenue neutral. Naturally, the top 1% do extremely well out of Trump’s plan.

    Anyway, if Hammond is thinking of “resetting” his fiscal policy, will he do it quickly; the Bank is sorting our IHT tax reduction plan at the moment. Stretching the nil rate band to a level as previously advertised by Osborne, would do nicely.

    PS. If you are interest in making your own UK tax plan, have a look at .

    July 24, 2016

    Second paragraph: “Mr Trump does have a more positive side” JR you write this after mentioning in the first paragraph Trump “dealing with the darker issues of crime, terrorism and migration.” Well dealing with these issues ARE positive too.

    The British government:-

    Has failed to reduce migration but the reverse.
    It has failed miserably, partly because of an ignorant, aggressive and violent foreign policy, of reducing the threat of terrorism but the reverse.
    Ms Amber Rudd, our new Home Secretary, for the many wondering as to her identity, stated yesterday crime increased dramatically under Theresa May’s Home Office stewardship and risen cataclysmically due in the period where Mr Cameron deserted his post leaving the country without leadership. She says ” The CPS prosecuted 15,442 hate crimes in 2015-16 – a 4.8% rise on the previous year. ”

    It is to be hoped, no pun intended, the Home Office will not now be rudderless. That a competent and loyal person will be Prime Minister and Home Secretary who can allay the genuine fears and concerns the British have about uncontrolled intrusion upon their island of non-British people

  16. Rods
    July 24, 2016

    Personally, I think US tax rates will be the least of our worries with these two deeply flawed candidates.
    Both think laws are only for little people.
    Both present major global security threats one who ran their own private (almost certainly hacked) email server. which contained classified State Department emails. US laws on classified material and the required use of official secure US Government communication channels are perfectly clear. The other who is happy to play chicken and potentially nuclear chicken in Eastern Europe over deciding who will get US support under NATO depending upon their ‘contributions’, which revanchist states will test.

  17. ian
    July 25, 2016

    YES well done rods you nail it.

  18. Lindsay McDougall
    July 27, 2016

    I’d vote for Trump but not for wholesale tax cutting. America’s fiscal deficit and total governmental debt (adding together Federal and State debt) are still huge. I haven’t heard Mr trump’s proposed Federal spending cuts, although his words imply fighting fewer oreign wars.

  19. James Winfield
    July 27, 2016

    Almost sounds like an endorsement. Very sad times.

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