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The Republican tax plan would offer temporary relief to lower- and middle-class families--but the richest one percent of Americans would be the clear winners in the long run, according to report by the Institute on Taxation and Economic Policy. (Photo: Emmeline Prufrock/Flickr/cc)
Further proving the Republican plan to overhaul the tax code is nothing but a giveaway to the nation's richest corporations, individuals and families, a new analysis out Monday shows that even the meager tax relief enjoyed by the middle class will disappear over time--ultimately becoming a tax increase for many--while nearly fifty percent of the total benefit will go to the nation's top one percent.
The Republican tax plan whose details were revealed last week has already been harshly rebuked by critics for the benefits that corporations and the wealthy would immediately enjoy should it pass in Congress, while lower and middle class Americans will see only meager gains, if any. But a new study shows that the plan is set up to benefit the wealthy even more over time--while the vast majority of most Americans will see a gradual erosion of their own advantages.
"The 10-year outlook for the plan reveals that it would be even more generous to the top one percent in later years," according to the Institute on Taxation and Economic Policy (ITEP). In 2018, about 31 percent of the total tax cuts in the House plan would go to the richest one percent on households, with those families receiving an already-generous average cut of $64,720. Within ten years, the top one percent would receive 48 percent of the tax relief.
As ITEP research director Carl Davis showed on Twitter, an analysis of the plan's impact on all 50 states showed the percentage of Americans in a dozen states who would face a tax hike in 2027.
\u201cNew 50-state numbers: By 2027, 1/5th of taxpayers living in a dozen states would face tax hike under House bill. https://t.co/X3mlh2d56b 1/7\u201d— Carl Davis (@Carl Davis) 1509977258
Meanwhile, Republicans spent last week crowing about the $1,182 that would ostensibly be saved by the average middle-income household under the tax plan--savings that would be enjoyed by families of four making $59,000 per year.
These families would only see that tax cut in the first year, however. According to a report by Politifact, their tax cut would gradually become a tax increase, with the households owing $500 more in taxes in 2024. The erosion of the relief is due to the planned sunsetting of the $300 tax credit afforded to parents and the absence of inflation adjustments for the child tax credit, among other factors.
The New York Times also projected in a report last week that over time, "the myriad changes in the code would actually raise taxes on nearly 13 million tax filers who earn $100,000 a year or less."
In its report, the ITEP also noted another tax plan feature that the GOP has aggressively pushed has been vastly oversold--the elimination of the estate tax. "The bill takes great care to fully eliminate the estate tax--which only the richest 0.2 percent of households pay--while phasing out a $300 tax credit that would benefit middle-income families," said Alan Essig, executive director of ITEP. "Further, low- and middle- class families likely will pay for these tax cuts that mostly benefit the highest earners through reduced investments in education, health care, infrastructure, scientific research, environmental protections, and other priorities."
"A closer look at the details of this tax plan indicates that lawmakers are most serious about ensuring that they lower tax bills for the highest-earning households," Essig concluded.
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Further proving the Republican plan to overhaul the tax code is nothing but a giveaway to the nation's richest corporations, individuals and families, a new analysis out Monday shows that even the meager tax relief enjoyed by the middle class will disappear over time--ultimately becoming a tax increase for many--while nearly fifty percent of the total benefit will go to the nation's top one percent.
The Republican tax plan whose details were revealed last week has already been harshly rebuked by critics for the benefits that corporations and the wealthy would immediately enjoy should it pass in Congress, while lower and middle class Americans will see only meager gains, if any. But a new study shows that the plan is set up to benefit the wealthy even more over time--while the vast majority of most Americans will see a gradual erosion of their own advantages.
"The 10-year outlook for the plan reveals that it would be even more generous to the top one percent in later years," according to the Institute on Taxation and Economic Policy (ITEP). In 2018, about 31 percent of the total tax cuts in the House plan would go to the richest one percent on households, with those families receiving an already-generous average cut of $64,720. Within ten years, the top one percent would receive 48 percent of the tax relief.
As ITEP research director Carl Davis showed on Twitter, an analysis of the plan's impact on all 50 states showed the percentage of Americans in a dozen states who would face a tax hike in 2027.
\u201cNew 50-state numbers: By 2027, 1/5th of taxpayers living in a dozen states would face tax hike under House bill. https://t.co/X3mlh2d56b 1/7\u201d— Carl Davis (@Carl Davis) 1509977258
Meanwhile, Republicans spent last week crowing about the $1,182 that would ostensibly be saved by the average middle-income household under the tax plan--savings that would be enjoyed by families of four making $59,000 per year.
These families would only see that tax cut in the first year, however. According to a report by Politifact, their tax cut would gradually become a tax increase, with the households owing $500 more in taxes in 2024. The erosion of the relief is due to the planned sunsetting of the $300 tax credit afforded to parents and the absence of inflation adjustments for the child tax credit, among other factors.
The New York Times also projected in a report last week that over time, "the myriad changes in the code would actually raise taxes on nearly 13 million tax filers who earn $100,000 a year or less."
In its report, the ITEP also noted another tax plan feature that the GOP has aggressively pushed has been vastly oversold--the elimination of the estate tax. "The bill takes great care to fully eliminate the estate tax--which only the richest 0.2 percent of households pay--while phasing out a $300 tax credit that would benefit middle-income families," said Alan Essig, executive director of ITEP. "Further, low- and middle- class families likely will pay for these tax cuts that mostly benefit the highest earners through reduced investments in education, health care, infrastructure, scientific research, environmental protections, and other priorities."
"A closer look at the details of this tax plan indicates that lawmakers are most serious about ensuring that they lower tax bills for the highest-earning households," Essig concluded.
Further proving the Republican plan to overhaul the tax code is nothing but a giveaway to the nation's richest corporations, individuals and families, a new analysis out Monday shows that even the meager tax relief enjoyed by the middle class will disappear over time--ultimately becoming a tax increase for many--while nearly fifty percent of the total benefit will go to the nation's top one percent.
The Republican tax plan whose details were revealed last week has already been harshly rebuked by critics for the benefits that corporations and the wealthy would immediately enjoy should it pass in Congress, while lower and middle class Americans will see only meager gains, if any. But a new study shows that the plan is set up to benefit the wealthy even more over time--while the vast majority of most Americans will see a gradual erosion of their own advantages.
"The 10-year outlook for the plan reveals that it would be even more generous to the top one percent in later years," according to the Institute on Taxation and Economic Policy (ITEP). In 2018, about 31 percent of the total tax cuts in the House plan would go to the richest one percent on households, with those families receiving an already-generous average cut of $64,720. Within ten years, the top one percent would receive 48 percent of the tax relief.
As ITEP research director Carl Davis showed on Twitter, an analysis of the plan's impact on all 50 states showed the percentage of Americans in a dozen states who would face a tax hike in 2027.
\u201cNew 50-state numbers: By 2027, 1/5th of taxpayers living in a dozen states would face tax hike under House bill. https://t.co/X3mlh2d56b 1/7\u201d— Carl Davis (@Carl Davis) 1509977258
Meanwhile, Republicans spent last week crowing about the $1,182 that would ostensibly be saved by the average middle-income household under the tax plan--savings that would be enjoyed by families of four making $59,000 per year.
These families would only see that tax cut in the first year, however. According to a report by Politifact, their tax cut would gradually become a tax increase, with the households owing $500 more in taxes in 2024. The erosion of the relief is due to the planned sunsetting of the $300 tax credit afforded to parents and the absence of inflation adjustments for the child tax credit, among other factors.
The New York Times also projected in a report last week that over time, "the myriad changes in the code would actually raise taxes on nearly 13 million tax filers who earn $100,000 a year or less."
In its report, the ITEP also noted another tax plan feature that the GOP has aggressively pushed has been vastly oversold--the elimination of the estate tax. "The bill takes great care to fully eliminate the estate tax--which only the richest 0.2 percent of households pay--while phasing out a $300 tax credit that would benefit middle-income families," said Alan Essig, executive director of ITEP. "Further, low- and middle- class families likely will pay for these tax cuts that mostly benefit the highest earners through reduced investments in education, health care, infrastructure, scientific research, environmental protections, and other priorities."
"A closer look at the details of this tax plan indicates that lawmakers are most serious about ensuring that they lower tax bills for the highest-earning households," Essig concluded.