The new tax plan is expected to cost between $1 trillion and $1.2 trillion over the next decade, according to a report by the nonprofit Tax Analysts.
But a new report released Wednesday by the non-partisan Tax Policy Center (TPC) shows that the vast majority of that sum could be coming from the very top 1 percent.
According to the TPC report, just over one in five of the tax cuts that are slated to go into effect in 2021 would benefit the top 1% of earners, while nearly half of them would benefit only the top 0.01 percent.
The TPC estimates that the average taxpayer in 2021 will receive an average tax cut of $3,000 in 2021, but the median household income in 2021 is $55,000, which would mean that just over half of the benefits would go to the top one percent.
And the TPS estimates that if the new tax rates on the top earners were to remain unchanged in 2021 and 2022, the average income for the top 40 percent of earners would jump by about $2,000.
The report also estimates that a $2 trillion increase in the national debt could be averted if the tax rate on the wealthiest Americans were to fall to 17 percent, which the TPAC says would only affect the top 3 percent.
The Tax Policy Coalition has been studying the impact of the Trump administration’s tax reform plan for several months now, and its new analysis shows that most of the revenue the GOP wants to raise is going to the wealthy, not the middle class.
“The Tax Foundation’s analysis of the GOP’s tax plan suggests that most income tax cuts for individuals and corporations are concentrated at the very highest income levels, while most other tax cuts would benefit everyone else,” the report states.
“In other words, the GOP tax plan would primarily benefit the wealthiest taxpayers, while other tax breaks would benefit most households.”
The Trump administration has released a report showing that the wealthiest individuals would see their taxes go up by more than $7,000 under the tax overhaul plan, but according to the Tax Policy Centre’s analysis, that’s because the tax cut for individuals would go up in 2018.
For example, a couple earning $50,000 would see a $3 million tax cut in 2021 if the GOP cuts the top marginal rate to 25 percent.
But that same couple would only get a $1 million tax increase in 2022, as the top rate would go down to 23 percent.
A married couple making $200,000 could see their tax bill increase by about a third under the GOP plan.
And for those earning between $50 and $200 million, the tax increase would jump up by $1,800.
But, for those making more than that, the Tax Foundation says that if there are no changes made to the estate tax, the richest Americans would see the biggest tax increase, with the average individual tax increase going up by almost $5,400.
And while most of that increase would come from the top two income tax brackets, the report says that in 2021 the top bracket would see more than 80 percent of the income tax hike, and that in 2022 the top income tax bracket would increase by more like 74 percent.
So what does this mean for middle-class families?
As of now, the Trump tax plan, if enacted, would increase the number of households that would pay more in taxes.
According the Tax Institute, that could have some impact.
According in the Tax Reform Commission report, the wealthiest 20 percent of households would see an average increase of $14,400 under the Trump plan, while the middle 20 percent would see only $1 and a half of that amount.
And if the Trump Administration follows through on its promises of repealing and replacing Obamacare, the top 2 percent of Americans could be hit even harder.
According an analysis from the Tax Justice Network, the rich would pay the highest percentage of taxes, with their tax bills likely increasing by more to $9,700 per year.
So if your income is below the top 20 percent in 2021 (and it’s already $1-million above the top), you’re still probably going to see some tax increases on your bills, even if your tax bill goes down by more.
But if your taxable income is more than the top 10 percent, your taxes will likely be even higher, thanks to the Trump-era tax plan.
In fact, the TPEc found that the tax bill for individuals with adjusted gross income (AGI) above $75,000 is expected have an average annual increase of more than 6.5 percent, while for AGI above $200.
The average AGI for the poorest 20 percent income bracket is expected increase by 3.3 percent.
The Trump tax proposal is set to go before the Senate this week, and the Senate is expected take up the plan this week.
Correction: An earlier version of this story included an incorrect figure for the number that would