“All Americans would suffer, but the strain on communities of color would be enormous,” said a coalition of concerned American citizens about Congress’ tax reform proposal.
The coalition consisted of members of the Center for American Progress, Marc Morial, president and CEO of the National Urban League, and an expert panel. They all participated in a meeting on November 29, to discuss the proposal and its impact on communities of color. Under the plan, they said, giant corporations would get large tax breaks, while the vast majority of Americans would get little to nothing, and many middle-class families would see their taxes rise in the coming years.
Worse they said, by exploding the national debt, the plan would give ideologues an excuse to slash investments in areas such as infrastructure, education, and workforce development, as well as in critical programs such as Medicare and Medicaid.
“Still suffering the fallout of the 2008 global financial and housing crisis, the long-term decline of manufacturing jobs, and the sharp curtailment of public spending since 2011, America’s communities of color do not need to see the ladder to the middle class pulled farther out of reach,” coalition members said via a statement.
“But massive tax cuts almost exclusively benefit CEOs and the largest political donors, while concentrating economic power in the hands of a smaller and smaller number of individuals.”
“This tax plan fundamentally stinks,” Morial said during the discussion.
“Because it stinks, fifty six percent of the population opposes it. To pass this plan is against the popular will [of the American people].”
The tax plan has a “poison pill” embedded in it, Morial said, involving 1.5 trillion in budget cuts over the next decade. These cuts will target important programs like health, education, housing, work force and all other important domestic investments. Also, he said, only the top one percent would receive the bulk of the benefits.
“This plan is lopsided in how benefits will be allocated,” Morial said.
“Over the last eight years, we’ve heard from the same voices how we can’t afford investments in any American communities,” said Neera Tanden, president and CEO, Center for American Progress.
“And yet within a year we are looking in massive tax cuts. The message that’s communicating to people who are struggling … their needs take a back seat to [the needs of the one percent].”
As explained by Heather Long of the Washington Post:
The plan will likely add to America’s $20 trillion debt. There are lots of tax cuts spelled out. There are almost no loopholes eliminated.
The rich make out pretty well. The White House vows poor people won’t have to pay more than they do now, but there are few specifics in the plan so far to ensure that.
Businesses (both small and large) get major tax cuts.
Most people will pay lower taxes, although it’s unclear if the rich get a bigger break than the middle class.
There are still a lot of details Congress has to figure out.
What’s in there for the rich?
The wealthy get a tax cut. They will pay only 35 percent on their income taxes (down from 39.6 percent). At the moment, this rate applies to any income above about $418,000. It’s unclear if Congress will tinker with the income level that rate kicks in at. Trump says he would be fine with Congress raising taxes on the rich in the final plan, but he isn’t requiring that they do that.
The bigger tax break for the rich is the elimination of the estate tax, sometimes called the “death tax.” It’s the tax families currently pay when an asset like a house or ranch worth over $5.49 million is passed down to a heir after someone dies. Trump’s plan scraps this tax entirely.