TRUMP’S TAX REFORM AND AMERICAN BUSINESS
https://doi.org/10.21686/2410-7395-2018-2-91-103
Abstract
The key aim of the Trump’s large-scale tax reform is to stimulate economic growth by lowering tax rates and providing tax deductions. The article examines the impact of the Tax Cuts and Jobs Act on American business and macroeconomic indicators. Reduced tax rates create significant advantages for companies doing business in the United States. Companies, primarily small businesses, expected to use additional cash for capital investments and development. Lowering tax rates will attract large corporations to invest in opening new facilities in the United States. The author analyzed the expert assessments and US GDP growth forecasts in the current and alternative scenario, as well as the impact of the Act on the growth of budget expenditures. Reform requires significant expenses and will cause budget deficit and public debt growth in the coming years, which can completely neutralize the positive effects at the micro level in the long term. However, tax incentives trigger market growth mechanisms in the economy, which helps to make the problem of growing public debt manageable and to overcome cyclical economic crises with less losses.
About the Author
P. A. Aksenov
Institute for US and Canadian Studies of Russian Academy of Sciences
Russian Federation
Russian Federation
PHD, Senior Researcher,
2/3 Khlebny per., Moscow, 123995
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Review
For citations:
Aksenov P.A. TRUMP’S TAX REFORM AND AMERICAN BUSINESS. International Trade and Trade Policy. 2018;(2):91-103. (In Russ.) https://doi.org/10.21686/2410-7395-2018-2-91-103
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