Wall Street vs. Main Street In Tax Bill
By: Dan Heyman, Public News Service – VA
RICHMOND, Va. — Analysts say the tax bill moving quickly through Congress benefits corporations, rich professionals and wealthy families at the expense of the national deficit and, ultimately, everyone else.
Republicans have promised that the tax bill will raise wages. But they admit the bill would cost $1.5 trillion over ten years. By the time it’s fully implemented, 80 percent of that would be going to pay for a big corporate tax cut, a slashing of the estate tax and a cut in taxes on pass-though income.
Howard Gleckman, senior fellow at the Urban/Brookings Tax Policy Center, pointed out that those tax cuts for businesses and rich households are permanent, while the benefits for the middle class will expire.
“For high-income people, it’s all about business taxes and corporate taxes, and of course the estate tax,” Gleckman said. “And in fact the winners and losers change over time, and actually you get more losers as time goes on.”
Republican leaders in the Senate are pushing to rush the bill through, hoping to have it done within a few weeks.
Pass-though income is money made by a business that the owner – often a professional such as a doctor or a lawyer – declares as income rather than as profit. Supporters of the tax bill say tax cuts on this kind of income will help small businesses.
But according to the Center on Budget and Policy Priorities, half of pass-through income goes to the top 1 percent of earners. Chuck Marr, director of federal tax policy at the CBPP, said congressional Republicans are already saying they plan to use the increased deficits to call for cuts in programs used by seniors, the middle class and working families.
“As soon as the ink is dry on this bill, we’re going to see Republicans point to that debt, point to those deficits,” Marr said. “They’ll go after Medicaid, they’ll go after nutrition, they’ll go after education, access to college.”
Marr said despite the “America first” trade rhetoric coming out of Washington, the bill would also encourage multinational corporations to make their money offshore by reducing the taxes they would pay when bringing their profits home.
