Wealthy Americans may get a tax cut 10 times bigger than a middle class family in the Biden social spending bill
Category: News & Politics
Via: monstermash • 3 years ago • 12 commentsBy: jzeballos@businessinsider.com (Joseph Zeballos-Roig) 8 hrs ago (MSN)
S E E D E D C O N T E N T
- Democrats are about to include a massive tax cut for the wealthy in their social spending plan.
- The plan could deliver much larger benefits to high-earners compared to middle-income families.
- Democrats argue that passage of the SALT cap in the Trump tax law was punitive to blue-state voters.
Rich Americans could come out much further ahead of middle-class families in President Joe Biden's $1.75 trillion social spending bill.
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Congressional Democrats are trying to raise the total amount of state and local taxes that people can deduct from their overall tax bills, known as the SALT cap. The House legislation lifts it to $80,000 from it's current $10,000 cap through 2026, undoing part of President Donald Trump's signature tax law.
That measure alone will provide a tax cut to wealthy households that's 10 times bigger than the largest tax benefit for middle-income families earning $50,000 - the child tax credit expansion - per a new analysis from the nonpartisan Committee for a Responsible Federal Budget.
A middle-income family can expect to get in one year $2,600 in federal aid from the revamped child tax credit. That's in stark contrast to the $25,900 annual tax break that wealthy people earning above $1 million can expect from lawmakers raising the SALT cap.
Marc Goldwein, senior policy director at the nonpartisan Committee for a Responsible Federal Budget, has called inclusion of the measure "baffling."
"SALT Cap repeal would be the single or the second largest individual item in Build Back Better," he said in an interview. "And it goes entirely to the rich. 98% of the benefit goes to people that are making six, seven figures, or more."
The House version of the SALT cap repeal is likely to undergo changes in the Senate. Sens. Bernie Sanders of Vermont and Bob Menendez are negotiating an alternative that could restrict who can receive the tax break to families earning somewhere between $400,000 and $1 million.
Democrats have long viewed the SALT cap as a punitive measure targeted at wealthier people in blue states like New York and California. "This is about punishing blue state voters," Sen. Ron Wyden, chair of the Senate Finance Committee, recently told Insider.
Still, the move is already exposing Democrats to a barrage of attacks from Republicans.
"I don't understand why Democrats seem to be hell-bent on what will be a huge tax windfall for the wealthy," Rep. Kevin Brady, the ranking Republican on the House Ways and Means Committee, said in a Fox News interview on Monday. "Lifting it is a hundred-billion-dollar giveaway to the wealthy a year."
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How about that, Democrats are giving the rich a massive tax break.
I wonder who will ever be dumb enough to believe Democrats when they lie next about taxing the rich?
They have to protect their bi coastal progressive elite crony capitalists in California and New York. After all, those urban elites needs are far more important than working and middle class subjects everywhere else….
I'm a middle income homeowner in CA and because the home my wife and I inherited in San Diego after her father passed didn't get the child to parent tax exemption to keep his prior property tax base (long story, the Dad she knew all her life was actually not her biological father and didn't officially adopt her till after she turned 18) we had to get the home reassessed and we're now paying over $12k annual in property taxes. Why should people be punished for having to pay more in taxes already just because some bitter rural folk don't pay as much and get to write off all their State and local taxes? The $10k cap was an intentional attempt to punish those who live in areas with high property values. It's not about being "rich", there are a lot of middle income families who would be helped by getting rid of the SALT cap.
Tax the rich on their income, don't punish people for having to pay higher State and local taxes just because of where they live. I've no doubt those who think the SALT cap is justified are just fucking jealous they don't own a home near the coast.
Thanks for saying that. I am kinda on the fence about this.
It is about how different states tax the citizens.
I was leaning against the tax yet now I am thinking it is people getting the same tax breaks as others. When one state gets its income from property tax, another state may get its income from sales tax.
So now I am thinking what this did was even the playing field between states.
Why should the rest of us have to pickup the slack in federal taxes for those that are allowed to keep their money at the state and local level? Don't act like California isn't the benefactor of federal tax dollar largess. Think all of those military bases in CA are free?
Federal funding makes up a third of California's budget.
Don't even bother to argue that California pays more out to the Federal government than it takes in- that ship has sailed. Too many California Democrat politicians at the Federal level for it to be otherwise.
Democrats giving a tax break to their rich benefactors (and themselves in many cases) is all this amounts to.
It did even the playing field between states. Why should the federal income taxes of many Americans be used to subsidize the state and local tax rates of a relatively few people?
Exactly! California has 1/8 of America’s population yet 1/3 of unemployed, homeless, welfare benefits paid out in state.
Maybe the states shouldn’t charge such high income and property taxes…I’m a Californian paying $1,100 a year in property taxes meaning your home is tax appraised at 11x the value mine is.
Lol. In other words, let me shirk my share of my federal tax burden so I can keep it at home. Let those "bitter rural folk" subsidize me and pay more than I do for our federal government.
ere are a lot of middle income families who would be helped by getting rid of the SALT cap
57% of the benefits go to the Top 1% of taxpayers. The few in the middle class it would benefit, on average, would receive a $27 tax break.
The only possible "middle class" people this could hurt own extremely valuable real estate that they probably can't afford. They are rich people who aren't liquid and don't want to pay taxes.
It is nothing but a HUGE tax break for the rich, where the VAST majority of the tax breaks will go.
Democrats need to stop the lying about taxing the rich WHILE giving them a HUGE tax break, America sees you lying!
And if you are paying too much in SALT taxes, the people to gripe to are your local and state officials--not the federal govt.!
You have to drill down to the root of the problem which in IMO, i have quoted above. Why do property/businesses that stay in the family have to get reassessed? I'll tell you why.
Because of liberal tax laws. Government entities trying to bleed the turnip for more $$. You are lucky you could afford to keep the home. Many people can't. I can't afford the home we built for our family in 1980. It's appreciated so much none of us can afford what the reassessed taxes would be.
It's the root of the problem you speak of and is total BS.