A report from Congress’ nonpartisan scorekeeper for tax policy reveals that the Democrats’ pending tax bill will raise taxes on the middle class — breaking one of President Biden’s key campaign promises.
The $2.9 trillion tax hike would raise the income tax, corporate tax, and income tax in order to fund the Democrats’ pending $3.5 trillion social welfare bill. Indeed, the Joint Committee on Taxation — composed of five members from the House Ways and Means Committee and five members from the Senate Finance Committee — confirmed that in the long-term, over 85% of taxpayers will witness a meaningful tax increase or receive no benefit whatsoever from the Democrats’ tax bill.
By 2023, taxpayers of virtually every income level will see sbstantial tax hikes:
- Nearly 5% of taxpayers earning between $40,000 and $50,000;
- 9% of those earning between $50,000 and $75,000;
- 18% of those earning between $75,000 and $100,000;
- 35% of those earning between $100,000 and $200,000; and
- 59% of those earning between $200,000 and $500,000.
By 2031, over three-quarters of taxpayers earning between $100,000 and $200,000 will see higher tax expenses.
“The Tax Cuts and Jobs Act cut taxes across all income groups, especially for the middle class,” commented Sen. Mike Crapo (R-ID) in a Senate Finance Committee press release. “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.”
Although Democratic lawmakers are marketing the legislation as an attempt to make wealthy Americans “pay their fair share,” an Americans for Tax Reform analysis found that the bill’s burden would fall largely upon the middle class — for example, by hiking taxes for 95% of small businesses, which are organized as “pass-through entities” that pay the income tax.
Likewise, boosting the highest corporate tax rate from 21% to 26.5% would harm roughly 1.4 million small businesses currently operating as C-corporations.
Another recent analysis from the Media Research Center shows that the typical American household spent $17,211 in taxes last year. However, their combined expenses for food, healthcare, clothing, and entertainment equated to $16,840 — meaning that Americans spent more on taxes than many of their core living expenses.