Source: United States Senator for Idaho Mike Crapo
Most taxpayers don’t benefit, while many–including millions of Americans making less than $400,000 per year–would see taxes increase
Washington, D.C.–A new analysis by the non-partisan Joint Committee on Taxation shows how few taxpayers will meaningfully benefit from the bill recently approved by the House Ways and Means Committee, as well as the fact that taxpayers across all income levels will face a tax increase under the bill in a direct violation of President Biden’s pledge to not raise taxes on anyone making less than $400,000 per year.
“The Tax Cuts and Jobs Act cut taxes across all income groups, especially for the middle class,” said Crapo. “This nonpartisan analysis shows that less than a third of all Americans will benefit from Democrats’ tax plans, with more than two thirds either experiencing no benefit or facing immediate tax hikes. The middle class and small businesses in particular will be getting very little—except for more taxes.”
Under the House Tax Bill:
- Few taxpayers benefit from the changes.
- In 2023, more than two thirds of all taxpayers will get essentially no benefit from the House Tax Bill or will experience a meaningful tax increase. By 2027, more than 85 percent of all taxpayers will fall into this category.
- These results apply across the income spectrum, including with respect to nearly 60 percent of those earning between $20,000 and $30,000 and nearly three quarters of all taxpayers earning between $30,000 and $100,000.
- Even those on the very bottom are more likely to get no benefit, with 64 percent of Americans earning less than $10,000 no better off than they currently are.
- Many middle-class taxpayers will specifically be worse off.
- In 2023, taxpayers of every income level will see meaningful tax increases, including:
- Nearly five percent of taxpayers earning between $40,000 and $50,000;
- Nine percent of those earning between $50,000 and $75,000;
- 18 percent of those earning between $75,000 and $100,000;
- 35 percent of those earning between $100,000 and $200,000; and
- 59 percent of those earning between $200,000 and $500,000.
- These results conclusively show that Democrats are willing to violate President Biden’s pledge for tens of millions of hard-working Americans.
- In 2023, taxpayers of every income level will see meaningful tax increases, including:
- Things only get worse for the middle class over time.
- In 2031, more than 80 percent of taxpayers earning between $20,000 and $500,000 will either see no benefit or will face a tax increase.
- In 2031, more than three quarters of taxpayers earning between $100,000 and $200,000 will face a tax increase.
If Democrats go on to include a repeal of the state and local tax (SALT) cap–as they have pledged to do–recent analyses from the Tax Foundation and others have shown that the net effect would essentially wipe out any tax hit on the wealthy, leaving the middle class to shoulder the brunt of the tax burden in their bill.
This analysis comes on the heels of a prior analysis, requested by Senator Crapo and House Ways and Means Ranking Member Kevin Brady (R-Texas), that found workers will shoulder the burden of the tax hikes and that within 10 years of a corporate tax increase, two thirds of the corporate tax burden would be borne by lower- and middle-income taxpayers.