Democrat Senators Vote Against Tax Relief for Middle Class Families and Small Businesses

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Posted by Alex Hendrie on Friday, February 5th, 2021, 11:18 AM PERMALINK

All 50 Democrat Senators voted against permanent tax cuts for American families and small businesses during consideration of S.Res.5, the Fiscal Year 2021 budget resolution.

During consideration of the budget resolution, Senator Mike Crapo (R-Idaho) offered an amendment that would permanently extend income tax cuts for small businesses and individuals that were passed in the 2017 Tax Cuts and Jobs Act (TCJA). These tax cuts will expire in 2025 because of budget rules that prohibited the tax cuts from adding to the deficit outside the ten-year budget window.

All 50 Democrat Senators voted "no'' on this amendment, while all 50 Republican Senators voted "yes".

By voting against this amendment, Democrats voted against significant tax relief for taxpayers in their states and across the country.

The TCJA reduced taxes for middle income families. According to IRS data, the average American household earning between $50,000 and $100,000 saw their average tax liability drop over 13 percent:

  • Americans with adjusted gross income (AGI) of $50,000 to $74,999 saw a 13.2 percent reduction in average tax liabilities between 2017 and 2018. 
  • Americans with AGI of between $75,000 and $99,999 saw a 13.6 percent reduction in average federal tax liability between 2017 and 2018.

 

This tax cut was twice as large as the tax cut received by Americans with income of $1 million or more – these taxpayers saw a 5.8 percent reduction in federal income taxes.

Strong middle class tax reduction was seen in every state across the country including in states represented by Democrat Senators. For instance:

  • In Arizona, taxpayers earning between $75,000 and $99,999 saw their average tax liability drop from $8,920.40 in 2017 to $7,658.675 in 2018, a 14.1 percent reduction in federal tax liability.
  • In Georgia, taxpayers earning between $50,000 and $74,999 saw their average tax liability drop from $5,459.71 in 2017 to $4,829.49 in 2018, a 11.5 percent reduction in federal tax liability.
  • In Michigan, taxpayers earning between $75,000 and $99,999 saw their average tax liability drop from $8,960.20 in 2017 to $7,604.86 in 2018, a 15.1 percent reduction in federal tax liability.
  • In Colorado, taxpayers earning of between $50,000 and $74,999 saw their average tax liability drop from $5,997.71 in 2017 to $5,220.98 in 2018, a 13.0 percent reduction in federal tax liability.

 

The TCJA also reduced taxes for small businesses. For instance, the law created a new, 20 percent small business deduction for businesses filing as passthrough entities. According to IRS data, 18.6 million filers claimed the small business deduction in 2018.

Because many small businesses file through the individual code, the tax rate reductions passed by the TCJA also reduced taxes for small businesses across the country.

By voting against Sen. Crapo’s amendment, Democrats voted to deprive families and small businesses in their states and across the country from permanent tax relief.

Photo Credit: barnyz

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