Republican Tax Bill Benefits Who?

Guest Blogger, Keith Flynn, is a labor attorney representing workers and a proud resident of Flint, MI.  He is a life-long Democrat and is an Alternate Delegate to the Michigan Democratic Party State Central Committee and the Co-Chair of the Genesee County Democratic Party Policy Committee.  

For those who suggest that there is no difference between the Democratic and Republican Parties—that they are two sides of the same coin—this week should have been another wake-up call.  In the middle of the night, the Republican-controlled Senate passed its own version of tax “reform,” which decreases taxes on corporations and the wealthiest few while raising taxes on the rest of us.  Republicans like to claim that they are party of fiscal responsibility, yet, these “reforms” would lead to a $1.5 trillion increase in the deficit over the coming decade—a debt that is being passed to our children and grandchildren.  While every Senate Republican with the exception of one voted for these “reforms,” I am proud to say that every Democrat voted against.

Elections have consequences.  The consequences that we face now that Republicans control the House, the Senate, and the Presidency is best understood by looking at how these tax bills will impact the average American.

First, according to the Congressional Budget Office (CBO), the government agency not affiliated with either party that is tasked with the duty to analyze the impact of legislation before it is passed, if the Senate bill becomes law, health insurance premiums would rise and 4 million Americans would lose health insurance by 2019.  13 million would lose their healthcare by 2027. That is 13 million people who could lose their life or bankrupt their family simply due to Republicans prioritizing a tax cut for millionaires over the health and safety of millions of Americans.

Second, it is without a doubt that if you are a corporation or an individual making more than $500,000 a year, you are going to receive a dramatic tax cut.  The tax cuts that the Republicans are proposing largely target the top 5% according to the nonpartisan Tax Policy Center.  The corporate tax rate is being slashed from 35% to 20%. Those who make over $500,000 a year will save more than $32,000 a year in taxes.  Wealthy Americans can also look forward to avoiding estate tax with the exemption being increased, at a minimum, from $5.6 million to over $10 million for singles and from $11.2 million to over $22 million for married couples.

If you are like the rest of us, however, Republicans targeted deductions commonly used by working and middle-class Americans.  For example, under the House bill, gone are the deductions for medical expenses, unreimbursed employees expenses, casualty losses, home equity loans, student loans, educator deductions, moving expenses, and tax preparation fees.  One of the most common deductions that millions of working and middle-class Americans have used—the deduction for state and local income and sales taxes—is also on the Republican chopping block.  These are important deductions that Americans count on that will not be there because Republicans believed it was better to give the top 5% a tax cut.

Third, Republicans are modifying the tax rates so that those who are wealthy will receive a larger decrease in their tax rate where others who are not will receive an increase. Under the House bill, if you make less than $9,525 single/$19,050 married a year, your tax rate will go up by 2%. Yet, if you make between $426,700 to $500,000 single/ $480,050 to $1,000,000 married, your tax rate will go down by 4.6%.

The Republican tax bill is nothing more than a scam so that the rich can get even richer. While Republicans claim that these bills are about job creation, there is no relationship between the size of corporate taxes and job growth.  Also, there is nothing in the bills that link these tax cuts with creating jobs in America, keeping jobs in this country, or paying American workers more.  Instead, Republicans have developed a tax system where American workers pay their employers’ share of taxes without any promises in return.  Such a bill that places the burden of funding our country on the backs of working Americans is perverse.  I am proud to be a Democrat because it was Democrats who stood up against these bills and who have pledged to continue to do so.  Politics matter, elections have consequences, and there is a difference in who you vote for.

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