Wednesday, October 27, 2021

As taxes go down, rich continue to pack up and leave

Tax the rich. Pay for schools. Maybe, just maybe, that will keep the rich from abandoning our country.

Democrats are doing everything they can to ensure it never happens.

Take Tax Cuts For The Rich.

The idea was supposed to help ordinary Americans while keeping taxes low for millionaires. Instead, it has become Exhibit A in a $40 million Democratic attack ad against Senators Chuck Schumer, the New York Democrat, and tax-cut-loving Oregon Senator Ron Wyden.

That ad says the GOP tax plan would hand a $6 million tax cut to billionaire businessman Mark Zuckerberg. Democrats say that’s wrong. They argue that giving Facebook’s Zuckerberg and other Wall Street fat cats smaller tax refunds is the same as giving them $6 million in salary. The Democrats say that’s about as generous as we can get.

Indeed, supporters of tax cuts for the rich say they are a vital way to help the working class. This is usually the defense put forward by Trump’s economic team, chaired by New Jersey Governor Chris Christie. “We’re making the tax code simpler and fairer for middle-class families, creating more take-home pay for the average family, but lowering taxes on millions of hard-working families,” Vice President Mike Pence said in June when the administration released its tax plan.

Sure, getting tax cuts for a few billionaires would be nice. But “perhaps?”—in the Pence speaking voice—is way more difficult to defend.

Some of the Democratic assault ads like the one on Schumer and Wyden include endorsements from Common Cause, Aspen Institute, Next Generation, Americans for Tax Fairness, Progressive Change Campaign Committee, The Political Action Committee, and the Democracy Coalition.

But Democrats, who enjoy strong support from the individual-income tax cuts for the rich — better known as the American inversion loophole — are largely playing defense. Democrats rarely attack, for example, instead trying to sound sympathetic about these tax cuts.

Republicans “are fighting to ensure that hardworking middle-class families don’t miss out on the tax cut,” said Republican National Committee spokesman Michael Ahrens in June. “That’s why they will work across the aisle to ensure tax relief reaches more than $4 trillion over 10 years.”

So who are the hardworking middle-class families the Republican tax cuts are supposed to benefit? In reality, they include wealthy individuals who are using complex legal strategies to avoid paying taxes.

In April, The Washington Post, reported on a provision in the Obama-era ACA’s health law that the GOP is now taking away. It required doctors, hospitals and insurance companies to report transactions with some of the richest individuals in the country.

Republicans now say they want to undo the provision, and the Wall Street Journal reported on Monday that the House will be targeting a tax credit for low-income families as a way to pay for a tax cut for the wealthy.

Corporate tax cuts, which Republicans would like to slash, also benefit the rich. According to the Joint Committee on Taxation, that provision could cost the Treasury as much as $90 billion over 10 years. Even Democrats supporting tax cuts for the rich acknowledge that money will need to come from somewhere.

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