Civic Register
| 10.4.17

Study Finds GOP Tax Plan Helps Wealthy, Hurts Middle Class

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What’s the story?

A study by the nonpartisan Urban-Brookings Tax Policy Center has found that the GOP’s "Unified Framework for Fixing our Broken Tax Code" would vastly benefit the top 1 percent of Americans while 1-in-4 households would pay more in taxes.

Despite promises by the GOP that their plan would benefit the middle class, the Tax Policy Center found that around 30 percent of taxpayers earning between $50,000 and $150,000 a year would see their taxes increase. The majority of households "making between about $150,000 and $300,000 would pay more, mainly because most itemized deductions would be repealed."

Meanwhile, the Tax Policy Center found that "the benefit would be largest for taxpayers in the top 1 percent (those making more than $730,000), who would see their after-tax income increase 8.5 percent."

A spokeswoman for Senate Majority Leader Mitch McConnell (R-KY) has dismissed the report.

Why does it matter?

President Donald Trump, announcing the tax plan in Indianapolis last week, promised the "reform will protect low-income and middle-income households, not the wealthy and well-connected. I’m doing the right thing, and it’s not good for me, believe me."

But even before the Tax Policy Center’s findings were announced, Democrats questioned Trump’s math.

"If this framework is all about the middle class, then Trump Tower is middle-class housing," said Oregon Sen. Ron Wyden, the ranking Democrat on the Finance Committee. “It violates Trump’s tax pledge that the rich would not gain at all under his plan by offering sweetheart deals for powerful C.E.O.s, giveaways for campaign coffers and a new way to cheat taxes for Mar-a-Lago’s loyal members.”

While the Tax Policy Center’s report confirmed these concerns, a spokeswoman for Mitch McConnell - one of the "Big Six" Republican lawmakers and White House officials who crafted the plan – dismissed the findings.

"This analysis is based on guesswork and biased assumptions designed to promote the authors’ point of view rather actual detail from a bill that has not yet been written by the committees," said Antonia Ferrier.

However, on the Sunday news programs following the report’s release, House Speaker Paul Ryan (R-WI) and Treasury Secretary Steven Mnuchin both acknowledged that it was impossible to ensure the middle class would get a tax cut.

"You can’t make guarantees because every single person’s taxes are different," Mnuchin told ABC News. “People take advantage of different things, so we can’t make that guarantee.”

Some GOP lawmakers are already expressing concerns. Sen. Rand Paul (R-KY) tweeted:

But Rep. Kevin Brady (R-TX), the chairman of the House Ways and Means Committee, derided the Tax Policy Center’s findings as a "work of fiction that Stephen King would have been proud of." While Brady would not guarantee to the New York Times that all middle-class taxpayers would get a tax break, he said:

"I will guarantee that we are going to work hard to lower taxes on every American, increase their paychecks and dramatically simplify the code for them."

What do you think?

Are the Tax Policy Center’s findings legit? Are you concerned you won’t get the tax cuts the Trump promised? Hit Take Action, tell your reps what you’d like to see in a tax plan, then share your thoughts below.

—Josh Herman

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(Photo Credit: AndreyPopov / iStockphoto)