For most hard-working Americans, Tax Day means paying the price of our democracy, supporting our national security, infrastructure, education system, and other vital public services. But for some at the very top, like Donald Trump, and many large multinational corporations, it is more aptly called “tax break day.” And particularly this year, there is jubilation at the very top for the coming Tax Day bonanza next year. Jammed through at warp speed with little opportunity for public analysis or debate, the new tax law is the product of one-party rule.
Disguised as tax relief for working families, this law actually provides 83 percent of the tax cuts to the top one percent of Americans by the end of the decade, only widening income inequality. By adding more than two trillion to the debt, it will mean cuts to your Medicare, Medicaid, Social Security, education, and other investments in our economic future.
Who benefits from the Republican tax bill? It’s a Who’s Who of not you.
Take for example the across-the-board cut in the top tax rate, paid by only those making more than about half a million dollars a year. Its cost to taxpayers? $220 billion over the next decade. That is only slightly more than the $200 billion in cuts to higher education student financial assistance that Trump proposed in his budget. The cost of tax breaks for those at the top shouldn’t be borne on the backs of struggling students.
Republicans have also attempted to trick the American people into believing that the tax breaks for corporations will – with a dash of fairy dust – land back in their pockets. But Americans aren’t buying it. President Trump promised that every American household would get a wage hike of $4,000 annually, but a recent survey found that more than two-thirds have not reported any additional compensation.
What are large corporations doing with the money? By buying back their own stock instead, they are handing it over to wealthy shareholders and their own CEOs, who have already done so well under this bill. The price-gouging drug-giant Pfizer offered a one-time bonus to its workers, but it gave 100 times as much to its executives and wealthy shareholders. And while Trump has been quick to take credit for any routine, one-time bonus, he shirked responsibility for the hundreds of workers Pfizer terminated when it shut down its Parkinson’s and Alzheimer’s research.
The Republican tax scam even includes special new tax breaks for multinational corporations that outsource American jobs. Encouraging multinationals to invest abroad instead of here at home puts America last.
I recently introduced legislation that would eliminate these new tax breaks: my No Tax Breaks for Outsourcing Act would end discrimination against companies with mostly domestic sales by not advantaging multinationals with large tax breaks on profits earned abroad. It is flat wrong that Davila Pharmacy should have to pay a higher tax rate on its American operations than Pfizer does on its offshore operations.
Rather than lavishing tax breaks on the wealthiest few and saddling our grandchildren with debt, I believe that to grow our economy, we need to invest in people. We need to protect Medicare and Medicaid, invest in educational opportunity, rebuild roads and bridges, and pass comprehensive immigration reform. These are the ways to really grow the economy and create a chance for more people to share in the American dream.
As the top Democrat on the Tax Policy Subcommittee, I will continue working to right this tax scam’s many wrongs. If you have questions about how this Republican tax bill may impact you, please contact me at my San Antonio Office at 210-704-1080. As always, I welcome your good counsel.