The Tax Cuts and Jobs Act: The Impacts on Jobs and Incomes by State
With the release of the Tax Cuts and Jobs Act, Americans are trying to understand how these tax changes would impact their families. The pro-growth tax plan would simplify the tax code by eliminating most itemized deductions, while reducing marginal tax rates.
Using the Tax Foundation’s Taxes and Growth (TAG) macroeconomic tax model, one analysis found that the “the plan would significantly lower marginal tax rates and the cost of capital, which would lead to 3.9 percent higher GDP over the long term [and] 3.1 percent higher wages.”
Indeed, the TAG model estimates that the plan would result in the creation of roughly 975,000 new full-time equivalent jobs, while increasing after-tax incomes by 4.4 percent in the long run. The increase in family incomes is the result of both the income tax cuts and the broader rise in productivity and wages due to economic growth. These estimates take into account all aspects of the Tax Cuts and Jobs Act, including changes to the individual and corporate tax codes.
See how it could positively impact Louisiana below, then read the full analysis here by clicking here.