WASHINGTON, Feb 24 (Reuters) - A tax reform package due to be unveiled this week by U.S. House Republicans would slash the top income tax rate to 25 percent from 39.6 percent and levy a surtax on some of the most affluent households, the Washington Post reported on Monday.
The plan by Representative Dave Camp, chairman of the tax-writing House of Representatives Ways and Means Committee, would also reduce the seven existing U.S. tax brackets to two, which would be set at 10 percent and 25 percent, according to the Post.
The plan, expected to be floated on Wednesday, would impose a 10 percent surtax on certain kinds of earned income over about $450,000 a year, the Post said, adding that the levy would hit many salaried professionals like lawyers and accountants, but not farmers and manufacturers.
Citing an analysis by the congressional Joint Committee on Taxation, the Post said the plan did not indicate which of the many tax breaks would be sacrificed to make possible the lower rates.
The newspaper said the analysis did show that the plan would achieve some of Camp’s goals for a simpler code that lowers rates while collecting the same amount of revenue.
“Not only did we meet that goal, but 99 percent of all filers are going to be subject to a rate of 25 percent or less,” The Post quoted a Republican aide familiar with the plan as saying.
The congressional analysis found that there would be little change in most Americans’ tax bills under the plan.
Camp has said he will release a tax-overhaul draft this week. It comes as hopes for comprehensive U.S. tax code reform before 2015 have all but vanished.
The Michigan lawmaker once promised that a tax overhaul would pass the Ways and Means Committee by 2013, but no bill was introduced. Congress is still deeply divided over fiscal policy.