What Should You Expect After the Election?
Audio version available here (1 min. 50 sec.)
Today marks Election Day, when voters across the nation will cast their ballots for the new President of the United States, as well as several other federal and local government officials. While many states, including Texas, hosted early voting polling sites, millions of Americans will be casting their votes today. How will the nation’s economic policies look after the election is called?
Let’s first take a look at Democratic-nominee Kamala Harris’ campaign promises. She has famously proposed higher taxes for the wealthy. This includes raising the corporate income tax rate—permanently lowered to 21% as part of the Tax Cuts and Jobs Act—to 28%. Additionally, individuals worth $100 million or more would be subject to a minimum 25% effective tax rate (the average rate paid across all income). For small businesses in their early stages, she proposes raising the startup costs deduction from $5,000 in the business’s first year to $50,000 over a flexible timeline. As for housing, Harris promises a $25,000 down payment support in addition to a $10,000 tax credit for first-time home buyers. She has also expressed support for raising the child tax credit.
Now let’s cover Republican-nominee Donald Trump’s policies. One of his many bold promises is to eliminate income tax on tip wages for service workers. In fact, he has proposed doing away with income tax on many fronts, including Social Security and overtime pay. For American corporations, he seeks to lower the corporate income tax rate from the 21% he established with the TCJA to 15%. To pay for these policies, Trump wants to impose higher tariffs on imported goods, especially from China. Most countries would be hit with a 10-20% tariff while China would face a 60% tariff at minimum. Meanwhile, cars being imported from Mexico would have a 100% tariff imposed.
While today is Election Day, it’s possible we won’t know the results of the presidential election for several more days, similar to the 2020 election. Until the election is certified, it’s best to prepare for either candidate to win. This means having sound business plans for the economic policies that could affect you and your business.
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