{"id":31123,"date":"2020-01-22T08:32:09","date_gmt":"2020-01-22T13:32:09","guid":{"rendered":"https:\/\/www.escapeartist.com\/?p=31123"},"modified":"2020-08-28T07:14:54","modified_gmt":"2020-08-28T11:14:54","slug":"us-tax-cuts-2020-us-economic-policy-and-thoughts-on-teak-hardwood","status":"publish","type":"post","link":"https:\/\/www.escapeartist.com\/blog\/us-tax-cuts2020-us-economic-policy-and-thoughts-on-teak-hardwood\/","title":{"rendered":"US Tax Cuts ~ 2020 US Economic Policy and Thoughts on Teak Hardwood"},"content":{"rendered":"<p><strong>So you may be asking, what do US Tax Cuts, 2020 US Economic policy and Teak Hardwood have in common.\u00a0 Read all the way to the end and I&#8217;ll make sure I bring it all together!<\/strong><\/p>\n<p><span style=\"font-weight: 400;\">Trump\u2019s tax reforms were welcomed by the entire republican government as one of the greatest achievements of the Trump administration. I\u2019m deeply amused at how inconsistent the government policy is because these reductions have been single-highhandedly overridden by this new trade war that the US president\u2019s been waging over the past year.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Even now, as Trump threatens to impose tariffs on Mexico, people are wondering if there was even a point to the tax cuts in the first place.\u00a0<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2><b>What Was The Tax Cuts And Jobs Act All About?<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Donald Trump showed up for his presidential campaign talking about how the previous governments have been destructive for the US economy and taking away the people\u2019s money. The US still has a long way to go, but even I can\u2019t believe the path the guy\u2019s taking in the aftermath of these cuts. Before we can speak about how the Republican\u2019s have shot themselves in the foot, we need to understand what the tax cuts were intended for.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In the interests of the American economy and the taxpayer, president Trump carried out one of the most extensive overhauls of the tax system seen in thirty years. The cut basically reduced the income tax brackets on the citizens and on corporations to create room for greater economic growth. While the Act maintained all seven of the original tax brackets, it basically reduced the tax rate across all the brackets. To summarize, the <\/span><a title=\"Making Your Way Into Teak Plantations In Panama\" href=\"https:\/\/www.escapeartist.com\/blog\/making-your-way-into-teak-plantations-in-panama\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">following changes<\/span><\/a><span style=\"font-weight: 400;\"> were introduced:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Reduction of the tax rates in the following manner:<\/span>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">39.6% top tax rate reduced to 37%<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">33% bracket was reduced to 32%<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">28% bracket to 24%<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">15% to 12%<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Reductions in mortgage interests<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Increasing tax deductions and credits for taxes related to children<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Reducing the corporate tax rate to 21%<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">These changes were expected to increase the availability of disposable income to both consumers and corporations to impose inflationary measures on the economy. For as long as people had money to spend, they would demand more goods and services to provide a stimulus for growth\u2014at least that was the general idea. Considering the less-than-optimistic economic outlook for the United States, that\u2019s a pretty textbook policy response. For a while people were happy because the government identified <\/span><a title=\"the following benefits\" href=\"https:\/\/taxfoundation.org\/tcja-one-year-later\/\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">the following benefits<\/span><\/a><span style=\"font-weight: 400;\"> from the act:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Long-run GDP growth by 2.6%<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Increase wages across the US by 1.5%<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Making investments more profitable<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Create 339,000 jobs across various sectors<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">The Republicans had something to cheer about given this outlook and the people were happy with Trump because he basically brought wealth back to America. Clearly, the president didn\u2019t know what he was doing when he initiated a trade war to reduce the trade deficits resulting from trade relations with China and its really cheap export markets.\u00a0\u00a0<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2><b>Enter The US-China Trade War<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">When he was campaigning, <\/span><a title=\"Trump proposed\" href=\"https:\/\/www.reuters.com\/article\/us-usa-trade-china-timeline\/timeline-key-dates-in-the-us-china-trade-war-idUSKBN1WP23B\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">Trump proposed<\/span><\/a><span style=\"font-weight: 400;\"> that he would impose trade tariffs on all goods coming in from China claiming that the country was using unfair trading practices. This was back in June 2016. That was the first ever hint of a possible trade war with the Chinese, which basically spelled out the biggest economic blunder in US history barring the 2007 GFC. Fast forward to 2017, the authorities in the US begin talks with the Chinese to reduce the trade deficit between the two countries.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">After negotiations broke down, Trump imposed tariffs on all imported washing machines and solar panels from China. This was followed by a 25% tariff on all steel imports and aluminum goods coming into the country. China retaliated and imposed tariffs of its own, in a sequence that is continuing to this day. Even now, the Chinese and Americans can\u2019t come to an amiable agreement that would postpone the imposition of tariffs but it looks unlikely that it\u2019ll happen.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">With the failure to negotiate a peaceful resolution to the trade war, Trump\u2019s tax reforms were rendered ineffectual because people were paying higher for goods than before the tax. It\u2019s pretty simple\u2014 corporations got a tax break of 14% but paid 25% for any goods brought into the market. Similarly, Trump docked a few points off a couple of base points off the tax rates on income, only to raise prices by 25%. People are now paying at least 14% higher on all goods being sold in the markets at the moment. So you really have to wonder\u2014why did Trump even introduce tax reforms in the first place?\u00a0\u00a0<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2><b>Economic Impact Of The Trade War<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The trade war has effectively cut off all producers from consumer markets in China\u2014a country that was also one of America\u2019s largest trade partners (<\/span><a title=\"trade is worth $1.9 trillion\" href=\"https:\/\/money.cnn.com\/interactive\/news\/economy\/how-us-trade-stacks-up\/index.html\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">trade is worth $1.9 trillion<\/span><\/a><span style=\"font-weight: 400;\">).\u00a0 This cuts into their revenues, while also increasing the prices charged by producers importing goods into the market from China. Essentially, he\u2019s stifled demand and revenue for everyone working in the US at the moment. That\u2019s a really great job president Trump.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2><b>Conclusion\u00a0<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">We have yet to see the full effects of the trade war, but one thing is for certain\u2014the only way to protect your wealth is through offshore tax planning.\u00a0 Taking your wealth to offshore locations will cut away the remaining taxes that are only adding to your expenses as a corporation and individual. Better yet, you should consider moving out completely before the US administration introduces increasingly disastrous economic policies.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">You could move your money to countries like Belize, Panama, and Nicaragua to possibly get second nationalities. These are a few countries that offer citizenship through reforestation programs. They cost minimal amounts and generate great revenues that aren\u2019t taxed as highly as in the US. Some places of note include:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\"><strong>Panama<\/strong>\u2014<\/span><span style=\"font-weight: 400;\"> is selling parcels of Teak plantations and helping people manage immigration to Panama. You can read more <a title=\"here\" href=\"https:\/\/info.ecidevelopment.com\/gap-nica-teak-1\" target=\"_blank\" rel=\"noopener noreferrer\">here<\/a>. If you would like to look at the numbers on owning a parcel of land in Panama with Teak Hardwoods, <a title=\"email Rachel Jensen\" href=\"mailto:expat@teakhardwoods.com\" target=\"_blank\" rel=\"noopener noreferrer\">email Rachel Jensen<\/a>.<\/span><\/li>\n<\/ul>\n<p>If you&#8217;ve not had a chance to listen to Rachel and I on my podcast <a title=\"Expat Money Show\" href=\"https:\/\/expatmoneyshow.com\/teak-webinar-registration\/\" target=\"_blank\" rel=\"noopener noreferrer nofollow\">Expat Money Show<\/a>, here is the link. It&#8217;s an amazing interview as Rachel really is a wealth of information.<\/p>\n<p><strong>I hope you enjoyed reading US Tax Cuts ~ 2020 US Economic Policy and Thoughts on Teak Hardwood<\/strong><\/p>\n<p><strong>Here are a few more articles that I&#8217;m pretty sure you will find interesting:<\/strong><\/p>\n<p><strong><a class=\"LinkSuggestion__Link-sc-1mdih4x-2 jZPuuT\" title=\"The Ways in Which a Second Passport Can Help\" href=\"https:\/\/www.escapeartist.com\/blog\/the-ways-in-which-a-second-passport-can-help\" target=\"_blank\" rel=\"noopener noreferrer\">The Ways in Which a Second Passport Can Help<\/a><\/strong><\/p>\n<p><strong><a class=\"post-title post-url\" title=\"Teak Markets in Panama \u2013 2020\" href=\"https:\/\/www.escapeartist.com\/blog\/teak-markets-in-panamain-2020\" rel=\"\"> Teak Markets in Panama \u2013 2020 <\/a><\/strong><\/p>\n<p><strong><a class=\"post-title post-url\" title=\"Making Your Way Into Teak Plantations In Panama\" href=\"https:\/\/www.escapeartist.com\/blog\/making-your-way-into-teak-plantations-in-panama\" rel=\"\"> Making Your Way Into Teak Plantations In Panama <\/a><\/strong><\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>So you may be asking, what do US Tax Cuts, 2020 US Economic policy and Teak Hardwood have in common.\u00a0 Read all the way to the end and I&#8217;ll make sure I bring it all together! Trump\u2019s tax reforms were welcomed by the entire republican government as one of the greatest achievements of the Trump [&hellip;]<\/p>\n","protected":false},"author":678,"featured_media":32091,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","om_disable_all_campaigns":false,"footnotes":"","_jetpack_memberships_contains_paid_content":false},"categories":[1399,578],"tags":[56,406,442],"yst_prominent_words":[4768,2120,3453,16800,15481,15480,2131,16799,3900,3418,3695,15479,8461,4249,3369,3365,3849,5178,15478,3353],"acf":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"https:\/\/www.escapeartist.com\/wp-content\/uploads\/2020\/01\/panam-teak-2.jpg","_links":{"self":[{"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/posts\/31123"}],"collection":[{"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/users\/678"}],"replies":[{"embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/comments?post=31123"}],"version-history":[{"count":14,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/posts\/31123\/revisions"}],"predecessor-version":[{"id":32246,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/posts\/31123\/revisions\/32246"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/media\/32091"}],"wp:attachment":[{"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/media?parent=31123"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/categories?post=31123"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/tags?post=31123"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/yst_prominent_words?post=31123"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}