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Anniversary of the Tax Cuts
Success or Failure >
RNC Research
June 22, 2018
6 Months Later: A Story Of Success
In 6 Short Months The Tax Cuts & Jobs Act Has
Delivered TaxCuts To Hardworking Americans, Helped Small
Business Soar And Jumpstarted Job Growth
· Job growth has accelerated since the GOP tax cuts passed in late December, adding 1,037,000 jobs in the first 5 months of 2018, compared to 862,000 during the same period in 2017.
· The bill increases the refundable portion of the Child Tax Credit, making the bill “more generous” to lower income families who don’t make enough to pay income taxes and therefore cannot benefit from the deduction.
· Small businesses have thrived in the wake of the Tax Cuts and Jobs Act, the NFIB Small Business Optimism Index has increased to the second highest level in the survey’s 45-year history in May.
THE GOP TAX CUT DELIVERED MUCH NEEDED TAX RELIEF TO LOWER AND
MIDDLE-CLASS AMERICANS
82 Percent Of Middle-Income Americans Will See A Tax Cut In 2018
82
Percent
Of Middle-Income Americans Will See A Tax Cut
In
2018. “In the middle
income-quintile, 82 percent will receive a tax cut and 9 percent will have
a tax increase.” (Frank Sammartino, Philip
Stallworth, and David Weiner, “The Effect Of The TCJA Individual Income Tax Provisions Across Income
Groups And Across The States,” Tax Policy
Center,
3/28/18)
Lower-Middle-Class
Households
Would
See
The Largest Tax Cut
As
A
Percentage
Of Their Income. “The Republican tax plan would lead to tax cuts for all income groups in
2019, with the lower-middle-class households receiving the largest tax reductions on a percentage
basis but upper-income households receiving the most money.” (Siobhan
Hughes,
“Government
Analysis
Shows 8% Overall Tax Cut
In
2019
Under GOP Plan,” The
Wall
Street
Journal,
12/18/17)
The Tax Cuts And Jobs Act Will Reduce
Individual Income Taxes By An Average Of $1,260 In 2018. “We estimate that the TCJA
will reduce individual income taxes by about $1,260 on average in 2018,
increasing after-tax incomes 1.7 percent (table
1). Taxes will decline on average across all income groups.” (Frank
Sammartino,
Philip
Stallworth,
and David Weiner, “The Effect Of The
TCJA Individual Income Tax Provisions
Across
Income
Groups
And Across The States,” Tax Policy
Center,
3/28/18)
In
2018,
Just Under 65 Percent Of Taxpayers Will Receive A Tax Cut From The Tax Cuts And Jobs Act Averaging
About $2,200. “We estimate that in 2018,
just under 65 percent of taxpayers will receive a tax cut from the included
individual income tax provisions—averaging
about
$2,200—and
about
6 percent will see an average tax increase
of
about $2,800
(table 2).” (Frank
Sammartino,
Philip
Stallworth,
and David Weiner, “The Effect Of The
TCJA Individual Income Tax Provisions
Across
Income
Groups
And Across The States,” Tax Policy
Center,
3/28/18)
A Tax Foundation Study Found That “The Tax Cuts And Jobs Act Would Increase The After-TaxIncomes Of Taxpayers In Every Taxpayer Group In 2018.” “On a static basis, the Tax Cuts and Jobs Act would increase the after-tax incomes of taxpayers in every taxpayer group in 2018. The bottom 80 percent of taxpayers (those in the bottom four quintiles) would see an average increase in after-taxincome ranging from 0.8 to 1.7 percent. Taxpayers in the top 1 percent would see an increase in after-taxincome on a static basis of 1.6 percent, driven by the lower pass-through tax rate and the lower corporate income tax.” (“Preliminary Details And Analysis Of The Tax Cuts And Jobs Act,” Tax Foundation, 12/18/17)
The Tax Policy Center Found That In 2018, Taxes Would Decline On Average Across All Income Groups.” “In 2018, taxes would be reduced by about $1,600 on average, increasing after-tax incomes 2.2 percent (table 1). Taxes would decline on average across all income groups. Taxpayers in the bottom quintile (those with income less than $25,000) would see an average tax cut of $60, or 0.4 percent of after-tax income. Taxpayers in the middle income quintile (those with income between about $49,000 and $86,000) would receive an average tax cut of about $900, or 1.6 percent of after-tax income.” (“Distributional Analysis Of The Conference Agreement For The Tax Cuts And Jobs Act,” Tax Policy Center, 12/19/17)
The Bill Increases The Refundable Portion Of The Child Tax Credit Making The Bill “More Generous” To Lower Income Families Who Don’t Make Enough To Pay Income Taxes And Therefore Cannot Benefit From The Deduction
The Tax Cuts And Jobs Act Increased The Maximum Refundable Portion Of The Credit From $1,100 To $1,400. “The maximum refundable portion of the credit increased from $1,100 to $1,400.” (Elaine Maag, “The TCJA Will Help Families With Children, But High Income Households Will Get Much Of The Benefit,” The Tax Policy Center, 12/22/17)
· The Bill Expanded The Refundable Portion Of The Child Tax Credit, Meaning That Families That Don’t Earn Enough To Owe Federal Income Tax Will Receive A Check From The Government For Up To $1,400 . “It also makes more of the tax credit refundable, meaning families that work but don't earn enough to actually owe any federal income taxes will get a large check back from the government. Benefits for those families were initially limited to about $1,100, but through changes Rubio and Lee pushed for, it's now up to $1,400.” (Heather Long, “The Final GOP Tax Bill Is Complete. Here’s What Is In It,” The Washington Post, 12/15/17)
Samuel Hammond, A Poverty Expert At The
Niskanen Center, Said That The
Increased
Refund
“Could
Make A Big Difference To Those Earning Under
$40,000 A Year.” “An
average
annual taxrefund
increase
of
$300 could make a big
difference to those earning under $40,000 a year, Hammond said. ‘That's
the annual cost for diapers for a lot of households. It's not
insignificant for a lot of very poor families,’ Hammond said. ‘People
are expecting miracles from a very weak bargaining position. If Rubio
hadn't done this, we would have wound up with nothing.’” (Jeff
Stein,
“What
Marco
Rubio Got For His Tax Vote,” The
Washington
Post,
12/19/17)
The Bill Makes The Child Tax Credit “More Generous For Low-Income Families.” “Thanks to a late push by Rubio and Sen. Mike Lee (R-Utah), the child tax credit would be more generous for low-income families and the working class.” (Heather Long, “The Final GOP Tax Bill Is Complete. Here’s What Is In It,” The Washington Post, 12/15/17)
Despite Democratic Rhetoric Suggesting Otherwise, The Tax Cuts And Jobs Act Makes The Tax Code More Progressive
Thanks To The Tax Cuts And Jobs Act, Lower Income Earners Pay A Smaller Share Of The Overall Tax Burden. “If the legislation is enacted, higher earners will pay an even larger share of the overall income tax burden than they do now. Our highly ‘progressive’ income tax will be even more progressive. That approach is counter to sound fiscal governance and undermines the growth potential of tax reform, but that is what Republicans are delivering.” (Chris Edwards, “Final Tax Bill: Biggest Cuts For The Middle,” Cato Institute, 12/19/17)
In
2017,
Sen. Chuck Schumer (D-NY) Claimed That “In My Long Career In
Politics, I Have Not Seen A More Regressive Piece Of Legislation.” “In my long career in
politics, I have not seen a more regressive piece of legislation, so
devoid of a rationale, so ill-suited for the condition of the country,
so removed from the reality of what the American people need.” (Sen.
Chuck
Schumer, Remarks
On
The
Senate
Floor,
Washington,
DC, 12/1/17)
In 2018, Under The Law’s New Tax Structure, The Top 20 Percent Of Households Will Pay 87 Percent Of Income Taxes Compared To 84 Percent Under The Old Law. “The results show how steeply progressive the U.S. income tax remains. For 2018, households in the top 20% will have income of about $150,000 or more and 52% of total income, about the same as in 2017. But they will pay about 87% of income taxes, up from about 84% last year.” (Laura Saunders, “Top 20% Of Americans Will Pay 87% Of Income Tax,” The Wall Street Journal, 4/6/18)
· The Lower 60 Percent Of Households Will Pay No Net Federal Income Tax In 2018 Compared To Just 2 Percent Last Year . “By contrast, the lower 60% of households, who have income up to about $86,000, receive about 27% of income. As a group, this tier will pay no net federal income tax in 2018 vs. 2% of it last year.” (Laura Saunders, “Top 20% Of Americans Will Pay 87% Of Income Tax,” The Wall Street Journal , 4/6/18)
THE
GOP TAX CUTS HAVE HELPED SMALL
BUSINESSES SOAR
The GOP Tax Cuts Eased The Substantial Burden Taxes Put On Small Businesses
Before
The Tax Cuts And Jobs Act, The Number
One Concern Of Small Business Owners In America Was Taxes. “Taxes are the No. 1
concern of small-business owners, according to the first
CNBC/SurveyMonkey Small Business Survey, released on Friday. A quarter
of small-business owners said that taxes are the most critical issue
currently facing their businesses.” (Elaine
Pofeldt,
“Most
Entrepreneurs
Are Optimistic Trump Will Rewrite Tax Code
That 'Strangles Them,’” CNBC,
9/9/17)
Ninety-Five
Percent
Of
Businesses
Are “Pass-Through” Businesses Rather Than
Corporations; These Businesses Are Not Subject To The Corporate Tax Rate, Their Income Passes
Through To The Owners And Is Taxed At Their Individual Income Tax Rate. “The
overwhelming
majority
of
businesses in the U.S. are not C-corporations
subject to the corporate tax. Rather, most businesses—about 95 percent—are
‘pass-throughs,’ which have their income ‘pass through’ to their owners
to be taxed under the individual income tax.” (Aaron
Krupkin
and
Adam
Looney, “9 Facts About Pass-Through Businesses,” Brookings,
5/15/17)
Pass
Through
Corporations
Received
A 20 Percent Tax Cut
From
The Tax Cuts And
Jobs Act, And, To Avoid
Fraud, Service Businesses Such As Doctors, Lawyers, And Investment
Offices Can Only Take A 20 Percent Deduction If They Make Less Than
315,000 Filing Jointly.
“In
’Pass
through’
companies get a 20 percent reduction: Most American
businesses are organized as ‘pass through’ companies in which the
income from the business is ‘passed through’ to the business owner's
individual tax return.
S
corporations,
LLCs,
partnerships and sole proprietorships are all
examples of pass-through businesses. In the final GOP bill, the
majority of these companies get to deduct 20 percent of their income tax-free,
a
large
reduction
that mirrors what was in the Senate bill. The
changes, however, expire after 2025. The National Federation of
Independent Business initially opposed the House version, arguing that
it didn't do enough for small businesses. But the NFIB later endorsed
the House and Senate plans. Service businesses such as law firms,
doctor's offices and investment offices can take only the 20 percent
deduction if they make up to $315,000 (for married couples).” (Heather
Long,
“The
Final
GOP Tax Bill
Is
Complete.
Here’s What Is In It,” The
Washington
Post,
12/15/17)
Rob Hassett, An Attorney At Business Law Partners Said, In 2018 “Small Businesses Will Almost All See Their Taxes Decrease.” “But, at least this year, small businesses will almost all see their taxes decrease, said Rob Hassett, an attorney at Business Law Partners — a change that could strengthen congressional Republicans going into the 2018 midterms. (Hannah Grabenstein, “Will Small Businesses Benefit From The New Tax Law?,” PBS, 2/27/18)
Small Businesses Have Thrived In The Wake Of The Tax Cuts And Jobs Act
The
NFIB
Small Business Optimism Index “Increased In May To The Second
Highest Level In The NFIB Survey’s 45-Year History.” “The
Small
Business
Optimism
Index increased in May to the second highest
level in the NFIB survey’s 45-year history. The index rose to 107.8, a
three-point gain, with small businesses reporting high numbers in
several key areas including compensation, profits, and sales trends.” (“Small
Business
Optimism
Index
Soars, Continuing Historic Run, Hitting Several
Records In May,” National
Federation
Of
Independent
Business,
5/18)
Nearly
20
Percent
Of
Small Businesses Are Looking To Create New Jobs, While 29
Percent Have Job Openings For Skilled Workers. “Small
business
owners
continue
to hire with a seasonally-adjusted net 18
percent planning to create new jobs. Twenty-nine percent of owners have
job openings for skilled workers, the third highest reading since 2000.
Twelve percent have job openings for unskilled workers, with the
strongest demand in the transportation, travel, communications, and
utilities sector. To compete in the job market, 35 percent of owners
reported increases in labor compensation to attract job applicants.” (“Small
Business
Optimism
Index
Soars, Continuing Historic Run, Hitting Several
Records In May,” National
Federation
Of
Independent
Business,
5/18)
Worker
Compensation For Small Businesses Was At A “Record Net 35 Percent Of
All Firms” In May. “Reports of higher worker
compensation pushed 2 points higher to a record net 35 percent of all
firms. Plans to raise compensation fell 1 point to a net 20 percent,
high but below its recent peak of 24 percent in January.” (“Small Business
Optimism Index Soars, Continuing Historic Run, Hitting Several Records
In May,” National
Federation Of Independent Business, 5/18)
In March 2018, Just Three Months After GOP Tax Cuts Passed, The Number Of Business Owners That Rated Taxes As Their Number One Business Problem Fell To A 35 Year Low. “‘It has been a remarkable 16 months for small business optimism,’ said NFIB President and CEO Juanita Duggan. ‘This is the first time in 35 years where the fewest number of small business owners have told us that taxes are their number one business problem. They’ve been so optimistic that they feel confident enough to raise wages and invest in their business, which grows the economy.’” (“Small Business Optimism Index Soars, Continuing Historic Run, Hitting Several Records In May,” National Federation Of Independent Business, 5/18)
THE
GOP TAX CUTS HAVE SPURRED JOB CREATION
ALL OVER THE COUNTRY
Job Growth Across The Nation Has Accelerated In The Wake Of The GOP Tax Cuts
For The First Time In At Least 20 Years, There Are More Job Openings Than Workers Looking For Jobs. “For the first time in at least 20 years, there are now more job openings than there are people looking for work. The ratio of unemployed workers to job openings dropped below one in April for the first time since the Labor Department started collecting data in 2000, the agency reported Tuesday.” (Lydia Depillis, “There Are Now More Job Openings Than Workers To Fill Them,” CNN, 6/5/18)
National Job Growth Has Accelerated Since The GOP Tax Cuts Passed In Late December, With 1,037,000 Jobs Added In The First 5 Months Of 2018, Compared To 862,000 During The Same Period In 2017. (“Employment, Hours, and Earnings from the Current Employment Statistics survey (National),” Bureau Of Labor Statistics , Accessed 6/21/18)
The Largest Gains In Job Growth Have Gone To “Groups That Have Historically Suffered From Stubbornly High Levels Of Unemployment, Including Younger Workers, Black Workers And So-Called Marginally Attached Worker.” “Most troubling for Democrats is that the biggest job gainers have been groups that have historically suffered from stubbornly high levels of unemployment, including younger workers, black workers and so-called marginally attached workers, whose employment is tracked by the BLS with the so-called U-6 rate. That measure includes part-time workers who want a full-time job and people who want to work but have given up looking and aren't in the official count of the labor force.” (John W. Schoen, “The May Jobs Report Is Great News For Everyone — Except Democrats Running For Office,” CNBC, 6/1/18)
Manufacturing Is Booming On The Back Of Pro-Growth Policies Like The Tax Cuts And Jobs Act
In The Latest Manufacturers’ Outlook Survey, 95.1 Percent Of Manufacturers Had A “Positive Outlook For Their Company,” The Highest Level Recorded In The Survey’s History. “According to the latest Manufacturers’ Outlook Survey, an astounding 95.1 percent of manufacturers registered a positive outlook for their company, the highest level recorded in the survey’s 20-year history. Additionally, expected growth for investments, hiring and wages is reaching historic highs.” (“2018 Second Quarter Manufacturers' Outlook Survey,” National Association Of Manufacturers, 6/20/18, Pg. 1)
It Is “Clear” That Manufacturing Businesses “Continue To Experience Highly Elevated Levels Of Activity As A Result Of Pro-Growth Policies Like Tax Reform.” “In the latest Manufacturers’ Outlook Survey from the National Association of Manufacturers (NAM), it is clear that businesses continue to experience highly elevated levels of activity as a result of pro-growth policies like taxreform” ” (“2018 Second Quarter Manufacturers' Outlook Survey,” National Association Of Manufacturers, 6/20/18, Pg. 1)
The Expected Growth Rate For Manufacturing Sales Remained At Its Highest Level Since 1997. “Expected Growth Rate for SALES Over the Next 12 Months ↑ 5.7% — remained the highest since 1997:4 (March: ↑ 5.7%)”(“2018 Second Quarter Manufacturers' Outlook Survey,” National Association Of Manufacturers, 6/20/18, Pg. 1)
The Expected Growth Rate For Full Time Manufacturing Employment Is At An All-Time High.“Expected Growth Rate for FULL-TIME EMPLOYMENT Over the Next 12 Months ↑ 3.1% — all-time high (March: ↑ 2.9%).”(“2018 Second Quarter Manufacturers' Outlook Survey,” National Association Of Manufacturers, 6/20/18, Pg. 1)
The Expected Growth Rate For Manufacturing Wages Is At The Highest Level Since 2001. “Expected Growth Rate for EMPLOYEE WAGES Over the Next 12 Months ↑ 2.7% — highest since 2001:1 (March: ↑ 2.6%).” (“2018 Second Quarter Manufacturers' Outlook Survey,” National Association Of Manufacturers, 6/20/18, Pg. 1)
THE TAX CUTS AND JOBS ACT IS HELPING
DISADVANTAGED AND LONG NEGLECTED COMMUNITIES GROW AND THRIVE
Tax Cuts And Jobs Act Designated “Opportunity Zones” In Economically Distressed Areas To Encourage Private Investment In These Underserved Areas
Opportunity
Zones,
Created
By
The Tax Cuts And
Jobs
Act Are “Economically-Distressed Community Where New Investments,
Under Certain Conditions, May Be Eligible For Preferential Tax Treatment.” “Q.
What
is an Opportunity Zone? A. An Opportunity Zone is an
economically-distressed community where new investments, under certain
conditions, may be eligible for preferential tax treatment. Localities
qualify as Opportunity Zones if they have been nominated for that
designation by the state and that nomination has been certified by the
Secretary of the U.S. Treasury via his delegation authority to the
Internal Revenue Service. Q. Who created Opportunity Zones? A.
Opportunity Zones were added to the tax code
by
the Tax Cuts and Jobs Act on December
22, 2017.” (“Opportunity
Zones
Frequently
Asked
Questions,” Internal
Revenue
Service,
Accessed
6/18/18)
Opportunity Zones Are Designed To Spur Economic Investment In Distressed Communities By Incentivizing Long Term Investment In Those Communities. “Q. What is the purpose of Opportunity Zones? A. Opportunity Zones are an economic development tool—that is, they are designed to spur economic development and job creation in distressed communities. Q. How do Opportunity Zones spur economic development? A. Opportunity Zones are designed to spur economic development by providing tax benefits to investors. First, investors can defer tax on any prior gains until the earlier of the date on which an investment is sold or exchanged, or December 31, 2026, so long as the gain is reinvested in a Qualified Opportunity Fund. Second, if the investor holds the investment in the Opportunity Fund for at least ten years, the investor would be eligible for an increase in basis equal to the fair market value of the investment on the date that the investment is sold or exchanged.” (“Opportunity Zones Frequently Asked Questions,” Internal Revenue Service, Accessed 6/18/18)
In The Few Months Since The Opportunity Zones Were Created, They Have Already Generated Significant Interest From Companies Looking To Invest
Just
A
Month
After
Opportunity Zones Were Approved In Arizona, There Has
Been Interest From “A Wide Variety Of People And Corporations On How To
Fully Use This New (And Really Fantastic) Tool” That Is A “Gift From
The Federal Government.” “In
just
the month since the federal government approved Gov. Ducey’s
suggested sites, we have collectively advised a wide variety of people
and corporations on how to fully use this new (and really fantastic)
tool. This ranges from the stock investor who has no property assets
but intends to sell stock this year for a significant gain, to those
who own property that is designated as an O Zone, and those who are
selling property and want to invest their gains into an O Zone property
to defer capital gains tax. Regardless of your political feelings about our
current administration, we can all agree that this is a most rare gift
from the federal government.” (Jordan
Rose
and
Jim
Belfiore, “The Opportunity Zone Is A ‘Rare Gift,’” East
Valley
Tribune,
6/4/18)
Montgomery
County
Maryland
Could
Get An Economic Boost Thanks To A New Federal
Program. Fourteen Opportunity Zones Have Been Designated Throughout The
County In An Effort To Spur Investment.” “Montgomery
County
could
get
an economic boost thanks to a new federal program.
Fourteen opportunity zones have been designated throughout the county
in an effort to spur investment. The program was created under the tax bill that was passed last
year. The state has nearly 150 opportunity zones. In Montgomery County,
that includes parts of Rockville Pike, the Montgomery College
Germantown campus, and downtown Wheaton. Many of the locations are near
Metro stations.” (Kylie
Khan,
“Opportunity
Zones
Spur Economic Growth,” WDVM
TV,
6/13/18)
In
West
Virginia, Parkersburg Mayor Tom Joyce Lauds The Opportunity Zones
As “Another Tool That We And Our Development Partners Can Use To
Attract Private Investment To The Community.” “Two
of
the
designated
zones are in Parkersburg: from the downtown central
business district north to Vienna and east along Seventh Street toward
West Virginia 47. ‘This is a great opportunity for the City of
Parkersburg and greater Mid-Ohio Valley,’ Parkersburg Mayor Tom Joyce
said in a press release. ‘It’s another tool that we and our development
partners can use to attract private investment to the community.’” (Evan
Bevins,
“Mid-Ohio
Valley
Features Six West Virginia Opportunity Zones,” The
Parkersburg
News-Sentinel, 5/27/18)
Officials
In
Helena,
Montana
Are Hopeful Opportunity Zones Will Attract
Investment That Is Otherwise Hard To Come By. “Business
development
groups
say,
in places like downtown Helena, it can be hard
to attract investment. ‘Getting access to capital – patient capital is
what we would call it – is very difficult,’ said Brian Obert, executive
director of the Montana Business Assistance Connection. Obert is
hopeful the creation of an ‘Opportunity Zone’ downtown can help change
that.” (Jonathon
Ambarian,
“Officials
Optimistic
About Opportunity Zone Designation For
Downtown Helena,” 9KXLH,
5/23/18)
In Florida Governor Rick Scott (R-FL) Is Hopeful That The “Zones Will Help Foster Continued Success In Our State By Bringing New Capital Investment And More Jobs.” “The U.S. Treasury has approved Gov. Rick Scott’s recommendation that seven census tracts in Escambia County be designated as ‘Opportunity Zones’, including Century and the immediately surrounding area. ‘These Zones will help foster continued success in our state by bringing new capital investment and more jobs to areas in every Florida county,’ according to the Governor’s Office.” (“Low Tax Opportunity Zones Approved For Escambia County, Including Century,” Northescambia.Com, 6/18/18)
Americans
for
Tax Fairness
FOR
IMMEDIATE RELEASE:
June 19, 2018
SCHOOL’S OUT: SIX-MONTH REPORT CARD GIVES TRUMP-GOP TAX CUTS FAILING GRADES
ATF Releases Report on How Tax-Cut Law Benefits Corporations and the Wealthy, Not Workers and Families, and Jeopardizes Health Care Coverage for Many
WASHINGTON,
D.C. – Marking
the six-month anniversary of the Trump-GOP tax cuts that were signed
into law December 22, 2017, Americans for Tax Fairness today released a Six-Month Report Card showing how the tax cuts
have affected employers, workers, families and health insurance
premiums both nationally and in individual states. An analysis backing
up the report cards grades is here. Not surprisingly, the
massive Trump-GOP tax cuts, which cost $1.9 trillion, get a failing
grade in each of five categories – fairness, increasing worker pay,
overall cost, protecting healthcare and sharing the wealth.
Along with the report card, ATF released a video and reports for 17 states showing how the tax cuts are primarily benefiting wealthy corporations and their shareholders and failing to raise wages for employees. A second report for the same states shows how the tax-cut law is causing health insurance premiums to spike throughout the country, and many state residents will lose their health care coverage because the tax law repealed a key provision in the Affordable Care Act.
“President Trump and the GOP promised that these huge tax cuts would primarily help the middle class, give workers a $4,000 raise, and lead to major business investment,” said Frank Clemente, executive director of Americans for Tax Fairness. “It’s now been six months since the tax cut law was passed, and none of those promises have come true. The law gets an ‘F’ for failing to deliver.”
Key
findings
from
the
ATF
report show that:
- Although President Trump promised the average worker would see a $4,000 pay raise due to the tax cuts, only 4% of workers so far are getting a bonus or wage hike.
- Only 402 of the nation’s six million employers have announced any plans to share their tax cuts with employees through bonuses or wage hikes. The total is estimated at $7 billion so far. But that pales in comparison to the $77 billion in tax cuts that just 156 corporations are getting this year.
- Corporations are giving huge windfalls to their CEOs and wealthy shareholders in the form of stock buybacks, as they own most stock. Corporations have announced $484 billion in stock buybacks since the tax law was passed. That’s 69 times more than the $7 billion corporations have promised workers through one-time bonuses and wage hikes.
- Despite the promise that the tax cuts would increase wages, the government reported last week that in the last year average hourly wages for four out of five workers in the private sector have gone down after inflation.
In addition, by effectively repealing the individual mandate in the Affordable Care Act, the tax-cut law will cause:
- 13 million Americans to lose health care coverage by 2025 [CBO].
- ACA insurance premiums to spike by 10%, on average, most years for the next decade.
“The Trump-GOP tax cuts are a disaster for workers, families and for health care coverage,” Clemente said. “First, the law repeals a key part of the Affordable Care Act, which will spike insurance premiums for many struggling families and older Americans near retirement age. Next, the tax cuts are jacking up the deficit giving conservatives in Congress an excuse to slash Medicare and Medicaid, and even Social Security.”
Despite the failure of the tax cut law to live up to the promises by its supporters, President Trump and members of his party are proposing a second round of tax cuts for the wealthy that could cost another $1 trillion. The resulting increase in the national debt will embolden conservatives to demand even more cuts to health care, education, nutrition services, housing and more. A letter from 130 national organizations opposed to these tax cuts is here.
See americansfortaxfairness.org for more information.
Contact:
Dennis Bailey
Director of Communications
Americans for Tax Fairness