Skip to main content

Why are the billionaires always laughing?

Because they know the corporate media will never call bullshit on their bullshit.

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)

Analysis Shows How #TrumpTaxScam Stiffs Middle Class While Giveaways to 1% Grow Over Time

Meager cuts to working people will be temporary, gradually turning into tax hikes, but the benefits to the wealthiest only getting better

Julia Conley

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.

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.

Our work is licensed under Creative Commons (CC BY-NC-ND 3.0). Feel free to republish and share widely.

This is the world we live in. This is the world we cover.

Because of people like you, another world is possible. There are many battles to be won, but we will battle them together—all of us. Common Dreams is not your normal news site. We don't survive on clicks. We don't want advertising dollars. We want the world to be a better place. But we can't do it alone. It doesn't work that way. We need you. If you can help today—because every gift of every size matters—please do. Without Your Support We Simply Don't Exist.

AOC Warns That Corporate Lobbyists Would Love People to 'Give Up Before the Deal Is Done'

"It's way easier for them to try to get away with the things that they're lobbying for and against if people at home aren't watching," said the New York Democrat

Jon Queally ·

Tlaib Leads Call for Biden to Take 'Commonsense Steps' to Aid Afghan Evacuees

"Our country has long offered shelter to those seeking refuge from catastrophe. Now is the time to continue that tradition and stand beside Afghan evacuees in need."

Jessica Corbett ·

'Huge Win': Green Groups Applaud Biden Move to Protect Minnesota Watershed

"You don't allow America's most toxic industry next to America's most popular wilderness," said one environmental campaigner.

Brett Wilkins ·

Taking Aim at Predatory Equity Firms, Warren Leads Bill to 'Stop Wall Street Looting'

"Now is the time," asserted Sen. Bernie Sanders, "to end Wall Street's greed, protect workers, and create an economy that works for everyone, not just the 1%."

Brett Wilkins ·

Arizona Groups Demand Sinema 'Stop Obstructing' on Medicare Expansion

The diverse coalition called on the Democratic senator to back "bold drug pricing reform" and "critical improvements to Medicare's coverage" in the reconciliation package.

Jessica Corbett ·

Support our work.

We are independent, non-profit, advertising-free and 100% reader supported.

Subscribe to our newsletter.

Quality journalism. Progressive values.
Direct to your inbox.

Subscribe to our Newsletter.

Common Dreams, Inc. Founded 1997. Registered 501(c3) Non-Profit | Privacy Policy
Common Dreams Logo