In a major blow to the Democrat push to repeal the Tax Cuts and Jobs Act, the Washington Post awarded three (3) Pinocchios to the assertion that the tax cuts were for the “wealthiest people.” The Post Fact Checker stated: “Most Americans, across all income spectrums, received some sort of tax cut.”
Sen. Bernie Sanders recently repeated the lie that the 2017 tax cuts gave “$2 trillion in tax breaks for the wealthiest people in this country and the largest corporations.” The Washington Post concluded the assertion was “mostly false,” and bestowed Three Pinocchios.
The Post stated:
Sanders is wrong to claim that $2 trillion in tax breaks went to the “wealthiest people in this country and the largest corporations.” Most Americans, across all income spectrums, received some sort of tax cut. But the share of the tax cuts for the top 1 percent was not as much as the share they pay in taxes — and some of the superwealthy experienced tax increases. There were limits placed on a new tax deduction for pass-through businesses owned by wealthy individuals.
The law cut the U.S. corporate tax rate from 35% — at the time the highest rate in the developed world – to 21%, which led to growth in wages, employment, and the economy. The Post notes this was hardly a windfall for large corporations as “companies with a lot of foreign income may have ended up with higher taxes and there were limits on tax breaks given to the wealthy who own pass-through businesses.”
In fact, the Post explains that the top 1 percent, who Sanders claims saw the greatest benefits, saw their taxes increase by almost $9 billion, as their share of taxes increased from 20.8 percent to 22.6 percent.
The Republican-passed Tax Cuts and Jobs Act has substantially helped low and middle income Americans:
- American families with incomes between $50,000 and $100,000 saw their tax liability drop by twice as much as Americans with income above $1 million.
- 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.
- Americans with AGI of $1 million or above saw a 5.8 percent reduction in average federal tax liability between 2017 and 2018, less than half the tax cut seen by Americans with AGI between $50,000 and $100,000.
- 90 percent of households with income between $40,000 and $64,000 saw a tax cut. Average size of that tax cut: $810. 91 percent of households with income between $64,000 and $108,000 saw a tax cut. Average size of that tax cut: $1,400
- The Tax Cuts and Jobs Act doubled the standard deduction for an individual from $6,000 to $12,000 and for a family from $12,000 to $24,000.
- The Tax Cuts and Jobs Act doubled the child tax credit from $1,000 to $2,000 per child.
- Over 2.6 million jobs were created in 2018 and over 5.4 million jobs have been created since the beginning of 2017 according to the Bureau of Labor Statistics. Nominal wages have grown by 3.4 percent over the last year, a ten-year high.
- The Tax Cuts and Jobs Act repealed the individual mandate tax, which imposed a $695-$2,085 penalty on those who did not buy “qualifying” health insurance. 79 percent of taxpayers (5,264,380 households) that paid the individual mandate made less than $50,000 in annual income.
Several left-leaning national media outlets have acknowledged the fact that the Tax Cuts and Jobs Act helped middle income households:
New York Times: “Most people got a tax cut.”
Washington Post: “Most Americans received a tax cut.”
Washington Post: “Most Americans, across all income spectrums, received some sort of tax cut.”
CNN: The facts are, most Americans got a tax cut.”
CNN: “The majority of people in the United States of America did receive a tax cut.”
H&R Block: “The vast majority of people did get a tax cut.”
FactCheck.org: “Most people got some kind of tax cut in 2018 as a result of the law.”
FactCheck.org: “The vast majority (82 percent) of middle-income earners — those with income between about $49,000 and $86,000 — received a tax cut that averaged about $1,050.
New York Times also noted the “sustained — and misleading — effort by liberal opponents of the law to brand it as a broad middle-class tax increase.”
The left continues to push the lie that the TCJA only benefited upper income households and large corporations. In reality, there is abundant data which shows that low and middle income Americans saw the most substantial gains.
The Washington Post called out Sanders for perpetuating this false narrative. This will not stop President Joe Biden, Vice President Kamala Harris and congressional Democrats from repeating the lie as they try to repeal the TCJA.