November 16, 2017

House Passes Tax Cuts for the Rich and Corporations as a False Cure for Working People’s Economic Anxiety

news release

Following is a statement by Alan Essig, executive director of the Institute on Taxation and Economic Policy, regarding today’s House passage of the Tax Cuts and Jobs Act.

“For months, Speaker Paul Ryan has cited working people’s “economic anxiety” as a reason to push through tax reform. While the speaker has correctly diagnosed a defining social issue of our time, he and other Republican leaders continue to focus on a top-down remedy that will only make this problem worse.

“The House voted today to enact $1.5 trillion in unpaid for tax cuts that are largely directed to the wealthy and corporations. An ITEP analysis of the plan finds 31 percent of the tax cuts would go to the top 1 percent in 2018 and 48 percent of them would go to the top 1 percent by 2027. Our analysis of the plan also shows that foreign investors would receive more in tax breaks under the plan than the bottom 60 percent of Americans. Further, many middle- and upper-middle-income taxpayers would face a tax increase.

“Opinion polling shows the vast majority of Americans do not support this tax plan. A significant percent believe it will only help the wealthy and corporations. Yet lawmakers continue full speed ahead with dubious promises that trickle-down economics will really work this time. This tax plan will not ease working people’s economic anxiety, it will make it worse.

“At a time when the wealthy have captured most of the nation’s economic gain, it is outrageous that House lawmakers are voting to enact large new tax breaks for the wealthy and corporations that not only would exacerbate this disparity, but could also lead to drastic reductions in the investments that expand economic opportunity to poor and middle-income Americans.

“But this process isn’t over. The Senate is currently working on its version of the bill. Like the House plan, it is an egregious giveaway to corporations and the wealthy, but it steps on working people even more by taking away health care from millions of vulnerable families to pay for tax cuts for the rich. Our elected officials need to take a step back from their tax proposals and remember that they should be working on behalf of the people, not CEOs and wealthy donors.”