President Trump has promised to “give the American people a huge tax cut for Christmas — hopefully that will be a great, big, beautiful Christmas present.” Unfortunately for millions of Americans, what they will be getting instead is a lump of coal in the form of a tax increase — courtesy of the GOP.
When George W. Bush campaigned for his 2001 tax cuts, he was able to truthfully say that “everybody who pays taxes is going to get tax relief.” Republicans can’t say that today, because it isn’t true.
According to Congress’s nonpartisan Joint Committee on Taxation (JCT), almost 1 in 10 Americans would see their tax bills go up under the Senate version of the Tax Cuts and Jobs Act. The Tax Policy Center comes to a similar conclusion. In 2019, about 9 percent of all taxpayers would see an average tax increase of about $2,700, including about 11 percent of middle-income taxpayers, who would see their tax bills rise by nearly $1,000. In 2025, 12 percent of taxpayers would see an average increase of $2,750, with 14 percent of middle-income taxpayers seeing their tax bills rise by $1,170. In all, just 76 percent of Americans would see their taxes go down under the Senate bill, while a quarter of all taxpayers would either see no benefit or see their tax bills go up — in many cases substantially.
This should never happen under unified Republican government. There are four words that no American should ever be able to utter: “Republicans raised my taxes.” To be clear, Democrats err when they claim that half the country will see a tax increase when the individual tax cuts expire in 2025 under the Senate bill, because everyone knows that they won’t all be allowed to expire — just like the Bush tax cuts were not allowed to expire under President Barack Obama except for those at the very top. But there are millions of Americans, including individuals and families at every income level, who would see their taxes hiked under the GOP plan.
At the American Enterprise Institute on Tuesday, I asked House Ways and Means Committee Chairman Kevin Brady (R-Tex.) about this. “I dispute those analyses,” he said, because they “describe an America that doesn’t exist, an America where the economy never grows, and paychecks never increase.” He pointed to a recent analysis in the Wall Street Journal by conservative economists who say tax reform would boost GDP by 3 to 4 percent long term, and said that as a result, “You’re going to see increases in paychecks. That matters for families as well. So, there’s more than just the rates in this tax reform.” In other words, even those who see their tax bills go up will be better off under the GOP plan.
That is a hard sell to voters. A new poll shows that while 73 percent of Americans believe in principle that Congress should cut taxes on individuals and small businesses and simplify the tax code, a 54 percent majority oppose the current Republican tax reform plans working their way through Capitol Hill. Why? Because 54 percent of Americans believe Republicans are going to raise their taxes. Many are wrong, but some are not. This should not even be a question in voters’ minds.
Americans see Republicans spending $1.5 trillion to fund a massive corporate tax rate reduction from 35 to 20 percent. The multinationals are taken care of, as is the donor class. The middle class? Not so much. They are losing many of their cherished tax deductions in exchange for a doubling of the standard deduction, an increase in the child tax credit and a tiny reduction in their tax rates. They are left on their own to figure out whether they are winners or losers under the GOP plan.
When Republicans reform the tax code, there should be no losers, especially not the middle class. For years, Republicans have been telling Americans: It’s not the government’s money, it’s your money, and we want to let you keep more of it to spend, save or invest as you see fit. If they raise taxes on millions, congressional Republicans will be violating that fundamental principle.
Fortunately, Brady says the bill could still change. “At every step we’ve worked to improve this,” he told me. “I would say, at the end of the day, wait till the final bill.” There are lots of middle-class taxpayers — and Republican voters — who hope he’s right.
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