White House: $4,000 more for families with business tax cuts

WASHINGTON (AP) — President Donald Trump’s chief economist says the administration’s plan to cut corporate tax rates will cause average household incomes to jump $4,000 a year — a stunning 5 percent increase that could be met with skepticism among tax experts and Democratic lawmakers.

The analysis by Kevin Hassett, chairman of the White House Council of Economic Advisers, says the estimated income growth is “conservative” and based on academic studies. The analysis argues that a large amount of the savings from trimming the corporate tax rate to 20 percent from 35 percent would flow to workers, rather than investors.

Separate studies, including a 2012 Treasury Department analysis, suggest the clear majority of any savings would go to investors and would be unlikely to push up wages as much as the administration says.