The US tax cuts

The Republicans are celebrating their huge success of passing the new tax bill, of course, the US President Trump is also celebrating and calling it the Christmas present for the Americans. However, I think that it is not a present for every America, as it mainly benefits those whose annual incomes are higher than 100,000 dollars. Those people' incomes are above the American average income. Given there is a wealth gap in America, the median income could be lower than the average income in America. This means the wealth gap would become even wider under the new tax policy. In general, any tax cut would lead to a wider wealth gap.

Usually, the policy of tax cuts aims to increase people's incentives to work harder and improve their productivity. In America, it does not have such issue. Moreover, too wide wealth gap would reduce the productivity. Therefore, the tax cuts may not be a wise move at the moment for the US. In addition, the corporate tax is also cut significantly; however, it may not mean that the US companies would transfer their benefits back home, especially those large multinational companies. The US corporate tax is not the lowest even after the tax cuts. The current US economy is actually in its almost best shape, no change is actually required at the moment, as the economic growth is strong, the unemployment rate is low and the number of jobs created increase over time. An additional policy may not stimulate the economy further but creates more social equality problems.