Donald Trump

Joe Lancaster | 10.11.2024 3:25 PM

As we enter the final days of the 2024 election cycle, the presidential campaigns are making their final pitches to voters. Former president Donald Trump's latest tax proposal sounds like good politics, but it also suggests no deeper economic message than wanting to get elected.

"We will make interest on car loans fully deductible," Trump said in a speech to the Detroit Economic Club on Thursday. "This will stimulate massive domestic auto production and make car ownership dramatically more affordable for millions and millions of working American families."

According to CNBC's Elizabeth Gravier, the average new car owner can expect to pay around $4,450 in loan interest over six years, while the average used car will cost its owner about $5,833 in loan interest over five years.

But tax filers would likely have to itemize their deductions—and 90 percent of taxpayers simply take the standard deduction instead of itemizing. For tax year 2024, the standard deduction is $29,200 for married couples and $14,600 for individuals, meaning any taxpayer who hopes to take advantage of Trump's proposed car loan interest break would necessarily have a significant amount of other deductions, like mortgage interest and real estate property taxes.

So while making car loans tax deductible makes little sense as economic policy, it makes perfect sense when you consider the audience: Detroit, home of America's auto industry. (After making the announcement, Trump even asked........

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