Congress Approves Tax Reform Bill

December 21, 2017 by · Leave a Comment 

Congress has officially passed the GOP tax bill backed by Pres. Donald Trump, after a procedural error forced the House of Representatives to take a revote early Wednesday to fix differences from the bill approved the 51-48 Tuesday by the Senate.

As expected, the vote ran mostly along party lines, with 224 votes – all Republicans – cast in favor, and 201 votes, including 12 from Republicans, opposing the measure.

Following the vote, Republicans cheered passage of what is the largest tax cut in decades.

The president is expected to sign the legislation into law this week, possibly as early as today. The bill is the first major tax cut since 1986 and the president’s first major legislative victory since taking office 11months ago.

During a celebration Wednesday in the White House Rose Garden, Trump, surrounded by the GOP leadership and the primary architects of the bill, said the effort had been “an incredible experience.”

On Tuesday, the House of Representatives voted to approve the GOP backed bill, but some parts of the bill conflicted with some of the Senate’s procedural rules had to be corrected before it could be sent to the president.

“[On Wednesday], Congress passed a tax reform bill that happens once in a generation. This is the end of a long journey to offer a great tax relief to the American people,” said House Speaker Paul Ryan after the vote was done.

“Now, this historic legislation will be sent to the President’s desk so we can start 2018 with a new tax code,” added Ryan, who has been fighting for a tax reform, such as the one approved on Wednesday, since the beginning of his legislative career.

The bill is fundamentally aimed at cutting taxes on high income earners and corporations, which will see their tax contributions significantly reduced from 35 percent to 21 percent, while generating seven personal income tax brackets.

In addition, according to the calculation of the Congressional Budget Office (CBO), the tax reform promoted by Republicans will add $1.5 trillion to the national deficit in its first 10 years.

Reducing the deficit has long been a rallying cry among conservative Republicans, many of whom nonetheless voted in favor of the Republican led tax reform plan saying the cuts would fire up corporate investment and hiring, which would in turn lead to substantial growth in the economy and ultimately help reduce the budget deficit.

Among the most controversial aspects, beyond the tax reduction to higher income earners, the legislation also repeals a portion of the Affordable Care Act, or Obamacare, which requires every individual to have health insurance, or to pay a tax penalty.

Corporate giant Comcast announced Wednesday that it will give $1,000 bonuses to over 100,000 of its employees as a result of the passage of tax-cut legislation in Congress, and the FCC’s repeal of net neutrality rules.

Comcast plans to invest $50 billion over the next five years in infrastructure towards its “broadband plant and capacity, and our television, film and theme park offerings,” House Speaker Ryan said in press release.

Ryan said Comcast expects to bring on thousands of new employees because of the investments.

Comcast’s announcement comes following AT&T saying it would offer $1,000 holiday bonuses to roughly 200,000 of its employees, a direct result of added profits the company expects to achieve under Congress’ tax reform legislation.

AT&T’s announcement comes as the company courts support from the Administration for its merger with Time-Warner.

President Trump mentioned AT&T’s news Wednesday at the White House as he celebrated passage of the tax bill with congressional Republicans.

Greenlining Institute President Orson Aguilar said Wednesday that the “’reform’ bill passed by the House and Senate spells disaster for Americans of color and all working families…

“There’s a reason this bill has been called the #GOPTaxScam on social media. It pretends to be a tax cut, but most working families will eventually see their taxes go up. Worse, it selectively targets Americans of color, who already sit on the losing end of a racial wealth gap that this bill will make worse,” Aguilar said in statement released Wednesday.

The Greenlining Institute’s statement criticizes the bill that it says will give “huge, permanent tax cuts to corporations and wealthy individuals but only modest and temporary relief to working families.”

According to Greenlining, African-Americans, Asian-Americans and Latinos, who have for decades lacked health insurance at higher rates than their white counterparts, will see gains made under Obamacare destroyed as “cuts are made to Medicare, Medicaid and other programs essential to working Americans.

“By sabotaging Obamacare, this fake reform puts the health and economic survival of millions of Americans of color at risk,” Aguilar said. “By exploding the deficit, this tax scam sets the stage for devastating cuts to Medicare, Medicaid and other programs upon which tens of millions depend.”

EGP Managing Editor Gloria Alvarez contributed to this story.


An Appetite for Action on Tax Reform

October 26, 2016 by · Leave a Comment 

After the election, we need to focus on forcing the next president to address inequality and fix our upside down tax code.

In less than two weeks, this election will be over, and the task of governing will fall on the winning candidate and the reshuffled Congress. At the top of the list of issues to address in the early months of 2017 should be reforming our broken tax code.

Why should tax reform take center stage among the many issues plaguing the country?

Because Americans desperately want to see rising inequality addressed. Concern over the issue drove the insurgent Bernie Sanders presidential campaign and is top among issues of importance to Democratic voters.

Lest one think Sanders’ primary loss gave the green light for inaction on inequality, note that the socialist senator from Vermont is currently the most popular politician in the country.

The growing divides between the rich and the rest of us rank consistently among the most pressing issues facing all voters, not just Bernie supporters. In short, the public’s appetite for action is high, and the next president as well as Congress would do well to listen to them.

There are a number of drivers of inequality, but none are so obvious and so fixable as the deeply unfair tax code.

A review of tax returns by the New York Times last year showed the top one thousandth of 1 percent — the richest of the rich — pay just 17.6 percent of their income in taxes. For context, the top tax rate in the country, intended to tax these very people, is more than double that figure, at 39.6 percent.

Perhaps the most egregious poster child for the broken tax code is Donald J. Trump. The billionaire appears to pay zero federal income taxes. In other words, the major party presidential candidate has contributed nothing to the development of our roads and bridges, our schools and public parks, or any of the other essential public services that taxpayers make possible.

But Trump’s far from the only offender.

Wealthy households and their armies of lawyers and accountants are able to dodge paying their fair share through loopholes they helped put in place. The same goes for the most profitable corporations, many of which have also dropped their federal income tax rate to zero. Plenty of these corporations are exploiting offshore tax shelters to avoid paying over $700 billion in taxes.

It’s now commonplace for these elites to spend millions to save billions on tax reform. Meanwhile, working and middle class families, who don’t have millions to spend on lobbyists or “creative” accountants, are left to fill the hole.

The solutions to fix the tax code and thus make a dent in reversing inequality are straightforward.

Close the expensive loopholes and offshore tax havens that only exist to encourage tax evasion. Update the tax code to ensure those who make their money via investments or inheritance pay taxes on their income the same way people who punch a time clock do.

Of course, the simplicity of a solution doesn’t imply it’ll be easy. Powerful forces aligned to create the unfair tax code we have now, and they’ll go to great lengths defending it. An equally powerful movement will be required to overcome this, on par with the social movements required for all the major steps forward our country has taken in its history.

The conservative anti-tax activist Grover Norquist famously said, “You win the tax issue, you win all the issues.” On this point, he was right.

Josh Hoxie directs the Project on Taxation and Opportunity at the Institute for Policy Studies. Distributed by 

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