If you listened closely to today’s House Ways and Means Committee hearing on the Tax Cuts and Jobs Act (TCJA), you could sense that the witnesses speaking in favor of the new tax law were not 100 percent on the same page. This has been apparent ever since the law was enacted at the end of last year. The economists who speak in favor of the law (including Douglas Holtz-Eakin at today’s hearing) tend to focus on other indicators of its success. They know that the talk of bonuses and raises is nothing more than a desperate corporate PR campaign to save the law from being repealed or scaled back in the future.
Steve Wamhoff
Steve Wamhoff is ITEP’s director of federal tax policy. In this role, he is responsible for setting the organization’s federal research and policy agenda. He is the author of numerous reports and analyses of federal tax policies as well as in-depth policy briefs that outline how the federal income tax and corporate tax code can be overhauled to improve tax fairness.
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blog May 16, 2018 Why Proponents of the Trump-GOP Tax Law Can’t Get their Story Straight
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blog May 15, 2018 There Is No Evidence That the New Tax Law Is Growing Our Economy or Creating Jobs
The House Ways and Means Committee will hold a hearing on the Tax Cuts and Jobs Act (TCJA) Wednesday. Proponents of the law likely will use the occasion to tout its alleged economic benefits and argue that its temporary provisions should be made permanent. The title of the hearing is “Growing Our Economy and Creating Jobs,” but there is little evidence that the law does either of these things.
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May 15, 2018 The Hill: We Need Real Tax Reform
Following is an excerpt from an op-ed by Steve Wamhoff, ITEP director of federal policy, published in The Hill on May 15, 2018. By now, it’s crystal clear that the… -
blog May 10, 2018 No Work Requirements for the Richest 1 Percent — Most of Their Tax Cuts Are for Unearned Income
The Trump Administration is pushing to add or strengthen work requirements for programs that benefit low- and middle-income people but holds a different view when it comes to the wealthy. Most tax cuts enjoyed by the richest 1 percent of households under the recently enacted Tax Cuts and Job Act (TCJA) are tax cuts for unearned income.
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blog May 2, 2018 New UK Law May Shut Down the Biggest Tax Havens — Aside from the U.S.
The United Kingdom’s parliament has enacted a new law requiring its overseas territories — which include notorious tax havens like Bermuda, the Cayman Islands, and the British Virgin Islands — to start disclosing by 2020 the owners of corporations they register. This could shut down a huge amount of offshore tax evasion and other financial crimes because individuals from anywhere in the world, including the United States. have long been able to set up secret corporations in these tax havens to stash their money.
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blog April 19, 2018 Congressional Budget Office: New Tax Law Helps Foreign Investors Even More than You Thought
President Trump and his allies in Congress have made many wild claims about economic growth that would result from the Tax Cuts and Jobs Act. And the Congressional Budget Office just released a report revealing the TCJA will, in fact, create economic growth — for foreign investors.
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report April 11, 2018 Who Pays Taxes in America in 2018?
America’s tax system overall is marginally progressive. The share of all taxes paid by the richest Americans slightly exceeds their share of the nation’s income. Conversely, the share of all taxes paid by the poorest Americans is slightly smaller than the share of the nation’s income going to that group.
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blog April 10, 2018 New ITEP Report: Extension of the Temporary TCJA Provisions Would Be Just as Regressive as TCJA Itself
A new ITEP report estimates the impacts in every state of the much-discussed idea of extending the temporary provisions in the Tax Cuts and Jobs Act, which will expire after 2025 without further action from Congress. The report concludes that extending or making permanent these provisions would be just as skewed to the wealthy as the original law.
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report April 10, 2018 Extensions of the New Tax Law’s Temporary Provisions Would Mainly Benefit the Wealthy
This analysis finds that extending the temporary tax provisions in 2026 would not be aimed at helping the middle-class any more than TCJA as enacted helps the middle-class in 2018.
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blog February 14, 2018 A Gas Tax Hike Is the Obvious Answer to Infrastructure Funding
As part of his budget plan released Monday, President Trump offered an infrastructure proposal that he describes as a $1.5 trillion 10-year surge in infrastructure investments. The details of the proposal explain that the federal government would put up only $200 billion of this total, which the administration claims will be offset with cuts in other spending. Even this relatively meager funding amount is illusory because it would clearly be financed by cutting other federal spending — including infrastructure investments.
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blog February 3, 2018 How Much Will Typical Middle-Class Workers Really See Their Paychecks Change?
The campaign by Republican leaders in Congress to promote their new tax law has two prongs. One is the claim that corporate income tax cuts are already trickling down to workers, which, as we have explained, is believed by basically no economists anywhere. The other prong of their campaign is to argue that the personal income tax cuts will provide a noticeable decline in withholding from paychecks that middle-class people will notice soon. At this point, it’s helpful to look at some actual data and see how small the boost in take-home pay will really be for most Americans.
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blog January 31, 2018 Fact-Checking Trump’s State of the Union Address on Tax Issues
Here are some claims the President made during his State of the Union address, along with the facts.
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blog January 26, 2018 Moody’s and Conservative Economists Agree: The Trump Corporate Tax Cut Is Not Helping Workers
Moody’s does not believe that corporate tax cuts are trickling down to working people as bonuses and pay raises. The real problem with the corporate PR campaign is that even those economists who supported Trump’s corporate tax cut and claimed it would help workers do not believe that it works this way.
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blog January 25, 2018 IRS Can and Should Block “Charitable Contribution” Schemes
States’ attempts to work around the new federal tax law and ensure their residents continue to maximally benefit from state and local tax (SALT) deductions have been in the news since the beginning of the year. At a panel discussion for tax professionals in Washington Thursday, Thomas West, tax legislative counsel at the Treasury Department, cast doubt on proposed work-around schemes that would convert state income tax payments into “charitable contributions.”
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media mention January 17, 2018 City & State: Cuomo’s Tax Work Arounds Would Be Challenging
Steve Wamhoff, senior fellow for federal tax policy at the nonpartisan Institute on Taxation and Economic Policy, gave the example that if a person gave $100 to a public radio… -
media mention January 17, 2018 Albany Times-Union: States Release Plans to Shift from Income to Payroll Taxes
But the concept has sparked questions from both sides of the political spectrum. “You are making the state code increasingly complicated and for what?” said Steve Wamhoff, a senior tax… -
blog January 17, 2018 Repealing, or Working Around, the Cap on State and Local Tax Deductions Would Make the Trump-GOP Tax Law Even More Unfair
A bipartisan proposal in Congress to eliminate the new $10,000 cap on federal deductions for state and local taxes (SALT) would cost more than $86 billion in 2019 alone and two-thirds of the benefits would go to the richest 1 percent of households. Unfortunately, “work around” proposals in some states to allow their residents to avoid the new federal cap would likely have the same regressive effect on the overall tax code.
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media mention January 12, 2018 Bloomberg: Trump’s SALT `War’ Revisited: Most Blue Staters Will Get Tax Cut
n blue New Jersey, for instance, the new law will raise taxes on about 285,000 filers earning between $79,890 and $336,620, with a typical hike of about $1,400, according to an… -
blog January 12, 2018 The Walmart Smiley Face Is Lying: Corporate Tax Cuts Are Not Causing Pay Raises and Bonuses
Last night, Yahoo reported that 81 corporations had announced pay raises and bonuses that they claim result from the Trump-GOP tax law’s reduction in the official corporate tax rate from 35 percent to 21 percent. Of these 81 corporations, 13 were included in ITEP’s most recent corporate tax study, which focuses on the Fortune 500 companies that were profitable every year from 2008 through 2015. These 13 companies had a combined effective tax rate of just 19.1 percent, which undermines the idea that the federal corporate tax rate was holding back their ability to pay workers.
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media mention December 22, 2017 Fortune: Real Estate Investors Will Love This Last-Minute Change to the Tax Plan
This is an excerpt from an op-ed by ITEP Senior Fellow Steve Wamhoff that appeared in Fortune. A last-minute change to the just-passed tax plan that would benefit real estate… -
media mention December 20, 2017 The Chicago Tribune: The GOP Tax Plan Has a Nasty Surprise for Parents with College-Age Kids
“I don’t think they gave it a lot of thought,” said Steve Wamhoff, senior fellow for federal tax policy at the Institute on Taxation and Economic Policy. Currently, all parents… -
media mention December 20, 2017 USA Today: The new tax plan will make Trump’s family richer, experts say. Here’s how.
“Usually when people sell property at a profit, that profit is considered income and taxed,” said Steve Wamhoff, senior fellow for federal tax policy at the nonpartisan Institute on Taxation… -
blog December 19, 2017 Final Tax Bill Hits Parents of College Students Harder than Other Taxpayers
While many provisions targeting higher education in previous versions of the tax plan were eventually dropped, little thought has been given to how the bill still raises taxes on parents at the time they are trying to pay for college tuition.
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blog December 15, 2017 Final Tax Bill Reported to Provide Senator Rubio With Much Smaller Improvement for Children than He Demanded
The latest news on the GOP tax bill is that, in order to secure the vote of Senator Marco Rubio, Republican leaders have agreed to expand the child tax credit — but only by a fraction of the amount that Rubio initially demanded.
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blog December 13, 2017 Latest “Compromise” for Tax Plan Is Even Worse than Previous Proposals, Would Reduce the Plans’ “Losers” by Less than 17,000 Taxpayers
Earlier this week, ITEP explained that two possible “compromises” to improve the Senate tax bill would accomplish very little other than make the plan more expensive. Incredibly, Republican leaders are…