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Derided by critics, trickle-down economics gets another try

“A far more generous bounty would go to the highest-earning 1 percent: An average tax cut of $62,000” writes The Associated Press for seattletimes.com. The nonpartisan Tax Policy Center has found that the House tax plan would deliver an average tax cut of $360 for middle-income taxpayers in 2027.In addition, Bartlett and other critics say, now is an especially inauspicious time for sharp tax cuts.Among the key planks in their legislation: Shrink the corporate tax rate to 20 percent from 35 percent.The White House says the plan’s corporate tax cut…

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Top White House economist rejects ‘trickle down’ criticism, says tax cuts will lead to growth

“Trump has touted the passage of the House tax reform bill as a victory” writes Sarah Westwood for washingtonexaminer.com. In a briefing with reporters, Hassett said “trickle down” economics is the name people give to tax cuts when they don’t favor those cuts.Hassett said the tax reform bill passed by the House this week contains all three of President Trump’s must-have provisions: a 20 percent corporate tax rate, middle class tax cuts, and a simplification of the tax code.He said the White House, which has spent weeks working with Congress…

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Howard Gold: Tax cuts may help realize Piketty’s dark vision of inequality

“The GOP tax plan may well have other benefits, and I support a corporate tax cut, but not one this big and that costs this much” writes Howard Gold for marketwatch.com. On Thursday, the House of Representatives passed, by a 227-205 margin, its long-awaited tax reform plan, dubbed the Tax Cuts and Jobs Act.But now comes the GOP tax bill, which may reverse that in several ways: • The threshold for paying the estate tax would nearly double and would be phased out over six years.The plan would permanently slash…

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Pass-through taxes could determine future of Senate tax reform plan

“That rate would be significantly reduced if either the House or Senate tax reform plan were to become law” reports foxbusiness.com. Currently, pass-through businesses are subjected to a top marginal tax rate of 44.6%.While the House pushed forward with approving its tax reform plan on Thursday, the Senate may taken a step in the opposite direction: Sen.More than 90% of businesses in the U.S. are considered to be pass-through businesses, which means they pay taxes based on the owner’s income rather than the corporate tax rate. Source: foxbusiness.com Share This:

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Corporate Buybacks Were So Last Year

“The corporate buyback appears to be going out of style” writes Ben Eisen for wsj.com. S&P 500 companies are poised to have repurchased about $125 billion of their shares in the third quarter, in line with its quarterly average so far this year, according to data from INTL FCStone. That puts 2017 on pace for the least amount spent on buybacks since 2012. […].  Source: wsj.com Share This:

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Treasurers Reveal Dismal Tech Adoption Rates

“In its report, the AFP examined corporate adoption of robotic process automation (RPA), artificial intelligence (AI) and blockchain technology” reports pymnts.com. Yet only 6 percent of corporate treasurers surveyed said they have implemented RPA into their systems in some way.According to the AFP’s research, corporate treasurers have a slew of hurdles to overcome if they’re ever going to implement these tools.The survey found that basic awareness of these innovations is the top barrier, with 58 percent citing this challenge as the largest that is holding back treasury and finance departments…

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Mark Cuban says tax rates have almost no impact on investment

“Billionaire entrepreneur and potential presidential candidate Mark Cuban said on Wednesday that a cut in the U.S. corporate tax rate would have little to no effect on his investment decisions” reports foxbusiness.com. Cuban argued that the best tax cut to spur growth would be employment tax reduction such as the 2-percentage-point payroll tax reduction that former President Barack Obama signed in 2010.”Amazon is going to affect a whole lot more companies and futures, as will Microsoft and Facebook and Google and other big companies, a lot more than a marginal…

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Markets News Stocks 

Stock market ‘not even close’ to pricing in tax cuts, says UBS

“Among sectors, telecom would be the biggest winner, they calculated, with an aggregate book tax benefit of 12% of net income and a cash tax benefit of 8%” writes Deputy Markets Editor for marketwatch.com. Think the stock market is already discounting a package of corporate tax cuts?. Financials would see a 9.2% boost to earnings but also a lower cash tax benefit, they said, while consumer discretionary and staples would get a 7% to 8% book and cash tax benefit.That’s 12% of the small-cap index in terms of market cap…

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Republicans begin pushing tax cut bill through Congress

“Hatch’s revised version of the tax bill would double the child tax credit to $2,000 from the current $1,000” writes Marcy Gordon for sun-sentinel.com. Republicans were planning the House would approve a similar tax bill on Thursday, though that version left the health law’s coverage requirement intact.They include dropping the corporate tax rate from 35 percent to 20 percent. Source: sun-sentinel.com Share This:

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Markets News Stocks 

Bloated company balance sheets signal trouble for stock market’s record run

“The ratio of non-financial corporate debt to GDP stood at 73.2% in the second-quarter of 2017, a near-record, according to data from the Federal Reserve Board” writes Sunny Oh for marketwatch.com. Aversion to highly leveraged companies is increasingly visible,” said the analysts, led by head of quantitative equity research, Andrew Lapthorne.With investors exercising care in their stock picking, equities have seen a wide divergence in performance this year.For those still holding the weak companies, the relative performance consequence is painful, leading to further selling and further polarization,” the strategists said. Source:…

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