There's the tradeoff.
Wanted to be sure you saw this Washington Post WonkBlog article, which includes a handy chart about who is footing the bill for the GOP’s huge, permanent tax cut for corporations. Despite what Republicans say about middle-class families benefiting from their tax bill, it’s clear that their legislation would result in a tax increase on middle-class households. Take a look:
“Republicans are paying for a permanent cut for corporations with an under-the-radar tax increase on individuals.”
“Thanks to a preliminary estimate from the nonpartisan Joint Committee on Taxation that was released alongside the final bill Friday, we know it’s individual taxpayers who ultimately bear the cost of the tax bill. The explanation is multifaceted.”
“The bill changes the way tax brackets are indexed to inflation. The bill adopts an inflation measure that economists regard as more accurate, but as the Wall Street Journal’s Greg Ip recently explained, it’s one that doesn’t increase as quickly….That effectively means people will enter higher brackets faster.”
“Over time, this effect grows in ways that hit the lower and middle class harder. The wealthy don’t jump brackets as often because there aren’t as many income breakpoints up in that rarefied air. In fact, once they’re in the top bracket, it’s no longer even a concern.”
“As a result, when all’s said and done, the net effect of all individual provisions in the tax bill, according to the JCT, is to raise taxes on individuals by a cumulative $83 billion in 2027.”
“Meanwhile, businesses are getting a $49.4 billion cut that year.”
“Thanks to a preliminary estimate from the nonpartisan Joint Committee on Taxation that was released alongside the final bill Friday, we know it’s individual taxpayers who ultimately bear the cost of the tax bill. The explanation is multifaceted.”
“The bill changes the way tax brackets are indexed to inflation. The bill adopts an inflation measure that economists regard as more accurate, but as the Wall Street Journal’s Greg Ip recently explained, it’s one that doesn’t increase as quickly….That effectively means people will enter higher brackets faster.”
“Over time, this effect grows in ways that hit the lower and middle class harder. The wealthy don’t jump brackets as often because there aren’t as many income breakpoints up in that rarefied air. In fact, once they’re in the top bracket, it’s no longer even a concern.”
“As a result, when all’s said and done, the net effect of all individual provisions in the tax bill, according to the JCT, is to raise taxes on individuals by a cumulative $83 billion in 2027.”
“Meanwhile, businesses are getting a $49.4 billion cut that year.”