GOP tax bills short-change middle class
When considering any attempt to reform our tax code, the first question I ask myself is, “Will it help the middle class?” After carefully looking over the Republican tax bills proposed in the House and Senate, the only answer I can come to is, “No, these bills won’t help the middle class.” In fact, they will do just the opposite.
The most glaring aspect of both of these proposals is how differently corporations and people are treated. Most notably is the fact that tax cuts for corporations are forever yet the cuts for the American people go away after just five years.
Not only are the cuts for individuals temporary but those individuals will also lose a number of popular deductions.
Currently, teachers who spend their own money on pencils, pens and paper for their students can deduct those costs. No more. The House bill ends that deduction. However, a corporation spending money on office supplies for its workers will still be able to deduct those costs.
About one in three San Diego taxpayers take advantage of the state and local tax (SALT) deductions. The House bill limits the SALT deductible amount to $10,000 for property taxes. The Senate proposal eliminates the SALT deductions all together.
College graduates paying off student loans can currently deduct the interest paid on their loan to lower their tax burden. The House ends that deduction, which will make it harder for people saddled with massive school loan debt to pay it off.
Ending the school loan deduction would increase the cost to students attending college by $65 billion over the next decade.
Ending the medical expense tax credit would not only hurt seniors but also veterans since many struggle with medical issues.
Veterans will also be hit hard with the end of two other tax credits — the work opportunity tax credit and the disabled access tax credit. Between 2013 and 2015, about 300,000 veterans took advantage of the work opportunity tax credit.
As you can imagine, I have been hearing from my constituents on the GOP/Trump tax bills. They are not happy.
Todd in El Cajon says his family will lose $28,350 in deductions against taxable income. Todd is the sole provider for his wife and five children ages of 1 to 11.
Sharon in Spring Valley counts on medical expense deductions to lower her tax liability.
I heard from Walter, a resident of Hillcrest, who is worried he will inevitably pay more in taxes because he will lose the student loan interest deduction and will fall into a higher tax bracket.
Finally, I have heard from a lot of my constituents who are worried about what this plan will do to the debt. I wish I could give them some words of encouragement. But the reality is — this plan would create a huge $1.5 trillion-dollar hole in our debt.
That’s $1.5 trillion that we won’t be able to invest in our country.
What does that mean? What could $1.5 trillion do for education? What could $1.5 trillion do for infrastructure? For veterans? For health care? For you and your family?
The very same people in Washington who have long argued that we need to take the debt seriously, now believe we can simply ignore it so that their corporate friends can get a tax break. Such a reckless approach won’t grow our economy. And it won’t help most San Diegans.
I am all for helping modernize our tax code. And our business leaders should be encouraged to invest more at home, instead of keeping their profits overseas.
But it is simply wrong to give huge corporations giant tax breaks, while ordinary working families are forced to pay more.
America has always been best when it has had a vibrant middle class — when prosperity was shared, rather than concentrated at the top.
Instead of closed door negotiations, we could have found a bipartisan path to a simpler tax code while being fairer to the American people who want to keep more of their hard-earned dollars. We could have paired tax reform with ways to better grow the economy rather than the time-worn failure of trickle-down economics, which is a “trickle” for the many and “raining buckets” for the few.
This column first appeared in San Diego Uptown New