House Democrats Vote Against Middle Class Tax Cuts

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Posted by Tom Hebert on Friday, June 21st, 2019, 4:15 PM PERMALINK

House Democrats voted against several Republican proposals to permanently cut taxes for the middle class.

The Democrat-controlled House Ways and Means Committee debated four pieces of legislation this week with very little public notice. Republicans offered numerous pro middle-class amendments, but Democrats shot down every proposal.

Republicans offered amendments to make the Tax Cuts and Jobs Act’s middle-class tax cuts permanent. If adopted, these amendments would have meant a permanent: 

  • Doubled standard deduction: this expansion resulted in dramatic tax reduction for the 105,055,150 million taxpayers that took it before the passage of tax reform, a number that has only increased since the TCJA became law.
  • Doubled child-tax credit: this expansion benefited over 22 million American middle-class families that claim the child tax credit.
  • Individual rate cuts: a family of four earning the median income of $73,000 is seeing a federal tax cut of $2,000, while overall tax liability has dropped by almost 25 percent, according to a report from H&R Block.
     

All of these provisions have helped middle-class Americans, and Democrats were unanimous in opposing them.

Democrats also unanimously opposed repealing the Medical Device Tax, an Obamacare holdover that devastated the American healthcare system while it was in effect. The medical device tax was in effect from 2013 and 2015 but Congress has suspended the tax since 2016. When it was in effect, research indicates that the tax reduced research and development by $34 million in 2013 and disproportionately harmed companies with lower profit margins. This resulted in a loss of approximately 28,000 jobs.

Finally, Democrats unanimously voted against cutting taxes for Americans with high medical bills. Before Obamacare, families facing high medical bills could deduct expenses that exceeded 7.5 percent of their AGI. According to the IRS, approximately 10 million families took advantage of this deduction each year before Obamacare was signed into law. In 2010, the average taxpayer claiming the deduction earned just over $53,000 annually.

Obamacare increased the threshold to claim the medical expense deduction to 10 percent of AGI. The TCJA restored the pre-Obamacare 7.5 percent threshold, but House Democrats opted not to make that increased threshold permanent.

Every time Democrats had the opportunity to extend or make middle-class tax cuts permanent, they refused. The next time Democrats tell you that they are for cutting taxes for the middle class, remember this week’s votes.

Photo Credit: Gage Skidmore

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