Watching the news or scrolling through Twitter becomes increasingly stress-inducing each day.
From sexual assaulters being outed (thankfully) to Trump spewing literal garbage, it all gets overwhelming, and sometimes large issues go unnoticed. With everything else going on, the House GOP tax plan has been flying under the radar. It’s a fairly confusing plan that covers lots of ground beyond taxation. Granted, it’s not the most exciting thing to read about, but it affects each and every one of us, so it’s critical to stay informed. So LISTEN UP! Here’s what you should know about the proposed plan.
Big businesses benefit greatly.
For big businesses, corporate income tax is reduced from 35% to 20%. Companies will also see other tax breaks, such as a lower taxation rate for money brought in from low-tax countries. The business tax system will also switch from a worldwide system to a territorial one, which WaPo explains business have argued for, for years. This means income is only taxed if it is made in the US, versus previously when money from around the world was taxed.
The rich do extremely well.
Ugh. I mean, are we surprised? But still, ugh. Multiple aspects of the new bill really benefit the extremely wealthy. For example, the value of assets needed to pay estate tax doubles. Previously, the estate tax was paid when property/assets valued at $5.5 million or more are passed on to heirs. Now it’s $11 million, meaning fewer people have to pay it. Additionally, the bill eliminates the “alternative minimum tax”, which was enacted in 1969 because too many high-income families had taken advantage of tax breaks and deductions to the point where that they paid no income tax at all. So the protection that ensures that doesn’t happen would be taken away.
Most people won’t get their taxes lowered anytime soon.
WaPo reports that 92% of Americans will only have a small tax break if any at all. And by 2023, only 40% of people will pay less, and 22% will actually end up paying more. And also by 2023, the Family Flexibility Credit (a key middle-class tax break), expires and everyone who makes under $70,000 or under will be paying more in taxes. Great…
13 million Americans will lose health care.
You’re probably wondering what health care has to do with taxes. The answer is nothing. The GOP is trying to trojan horse a semi-repeal of Obamacare by repealing the individual mandate. Without the mandate, many young and healthy people would most likely pass on insurance and so premiums would go up for everyone else. And with premiums skyrocketing, most folks would struggle to pay their medical bills. The CBO estimates that 13 million would no longer be covered and insurance prices would go up by 10%. Thanks, GOP.
Grad students will be screwed.
Tax cuts for the rich but not for graduate students? Apparently, that’s the Trump way. Currently, grad students get a tax break because they’re not charged taxes on their tuition, which is usually waived by Universities. But now that’s about to change. The GOP wants to charge grad students taxes on that non-existant tuition, meaning most will likely see their taxes doubled.
The separation of church and state is crumbling.
One of the founding principals of this country is the separation of church and state. Because of that, there’s currently a law in place that forbids churches, synagogues, and other tax-exempt institutions from “directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office” (Johnson Amendment). And if they do? They lose their tax-exempt status.
But with Trump’s tax plan, the Johnson amendment disappears. That means religious institutions can meddle in politics all they want with no consequences.
So that’s the rub. Angry that you’re getting screwed? Do something about it. Here’s how to call your senators.