Almost four years after the Tax Cuts and Jobs Act (TCJA) became law, IRS data shows it benefited middle- and working-class Americans more than the wealthy, improved economic mobility, and made the U.S. income tax system more progressive.
Based on this indisputable data, one would think progressives would cheer the success of the TCJA, however, don’t hold your breath waiting for any jubilee.
In the months leading up to the passage of the TCJA, leftists roundly criticized the bill as nothing more than a godsend for the rich at the expense of hardworking Americans.
For example, Sen. Chuck Schumer (D-NY) issued a press release on the eve of TCJA’s passage, claiming it would “stuff even more money in the pockets of the wealthy and the biggest corporations, while raising taxes on millions in the middle class.”
Schumer also claimed TCJA is “slanted toward the wealthy and powerful, and rains tax increases upon millions of middle-class citizens.”
Even more over-the-top was Rep. Nancy Pelosi’s (D-CA) assessment of the bill prior to its passage. According to Pelosi, the TCJA “is simply theft–monumental, brazen theft–from the American middle-class and from every person who aspires to reach it.”
Pelosi added, “The GOP tax scam is not a vote for an investment in growth or jobs, it is a vote to install a permanent plutocracy in our nation.”
While debating TCJA on the House floor, Pelosi described TCJA as “the worst bill in the history of the United States Congress.” She added TCJA would lead to “Armageddon,” as well as “the end of the world.”
Yet, here we are, four years later. The world has not ended. Armageddon has not taken place, either.
However, what has occurred four years after TCJA became law is the exact opposite of the dire predictions espoused by Schumer, Pelosi, and so many others.
First, according to IRS data, middle- and working-class Americans received a massive tax cut due to TCJA. In fact, the middle- and working classes were the biggest beneficiaries of the tax reductions in TCJA.
As Justin Haskins, editorial director at The Heartland Institute, documents in a new Policy Brief titled “Measuring The Effects Of The Republicans’ Tax Cuts And Jobs Act On Personal Income Taxes,” “According to data from the U.S. Internal Revenue Service comparing outcomes from 2017 to 2018—the first year the tax reform law went into effect—the Tax Cuts and Jobs Act reduced average effective income tax rates for filers in every one of the IRS’s income brackets, with the largest benefits going to lower- and middle-income households.”
Moreover, in direct contradiction to the left’s talking points on TCJA, “after accounting for all tax deductions and credits, filers with an adjusted gross income (AGI) of $40,000 to $50,000 received an average tax cut of 18.2 percent.”
In regards to Pelosi’s contention that TCJA would create a “permanent plutocracy,” the TCJA actually increased economic mobility.
As Haskins notes, “The IRS data further show that the Tax Cuts and Jobs Act appeared to have a strong upward effect on economic mobility. The number of filers with an adjusted gross income of $1 to $25,000 decreased by more than 2 million in just one year, while the number of households reporting incomes higher than $25,000 increased in every income bracket.”
And, concerning the left’s unyielding claims that TCJA would be a windfall for the wealthy, there is this inconvenient truth, “The IRS data also revealed that higher-income earners paid an even larger share of the total tax burden in 2018 than they did in 2017, indicating that the Tax Cuts and Jobs Act may have made the tax code slightly more progressive.”
What’s more, “In 2017, filers earning $500,000 or more paid 38.9 percent of all personal income tax revenues. In 2018, the same income bracket paid 41.5 percent of total income tax revenues.”
When it comes to the left’s outrageous lies about the Tax Cuts and Jobs Act, I cannot help but think of John Adams’ famous quip, “Facts are stubborn things; and whatever may be our wishes, our inclinations, or the dictates of our passion, they cannot alter the state of facts and evidence.”
Based on this indisputable data, one would think progressives would cheer the success of the TCJA, however, don’t hold your breath waiting for any jubilee.
In the months leading up to the passage of the TCJA, leftists roundly criticized the bill as nothing more than a godsend for the rich at the expense of hardworking Americans.
For example, Sen. Chuck Schumer (D-NY) issued a press release on the eve of TCJA’s passage, claiming it would “stuff even more money in the pockets of the wealthy and the biggest corporations, while raising taxes on millions in the middle class.”
Schumer also claimed TCJA is “slanted toward the wealthy and powerful, and rains tax increases upon millions of middle-class citizens.”
Even more over-the-top was Rep. Nancy Pelosi’s (D-CA) assessment of the bill prior to its passage. According to Pelosi, the TCJA “is simply theft–monumental, brazen theft–from the American middle-class and from every person who aspires to reach it.”
Pelosi added, “The GOP tax scam is not a vote for an investment in growth or jobs, it is a vote to install a permanent plutocracy in our nation.”
While debating TCJA on the House floor, Pelosi described TCJA as “the worst bill in the history of the United States Congress.” She added TCJA would lead to “Armageddon,” as well as “the end of the world.”
Yet, here we are, four years later. The world has not ended. Armageddon has not taken place, either.
However, what has occurred four years after TCJA became law is the exact opposite of the dire predictions espoused by Schumer, Pelosi, and so many others.
First, according to IRS data, middle- and working-class Americans received a massive tax cut due to TCJA. In fact, the middle- and working classes were the biggest beneficiaries of the tax reductions in TCJA.
As Justin Haskins, editorial director at The Heartland Institute, documents in a new Policy Brief titled “Measuring The Effects Of The Republicans’ Tax Cuts And Jobs Act On Personal Income Taxes,” “According to data from the U.S. Internal Revenue Service comparing outcomes from 2017 to 2018—the first year the tax reform law went into effect—the Tax Cuts and Jobs Act reduced average effective income tax rates for filers in every one of the IRS’s income brackets, with the largest benefits going to lower- and middle-income households.”
Moreover, in direct contradiction to the left’s talking points on TCJA, “after accounting for all tax deductions and credits, filers with an adjusted gross income (AGI) of $40,000 to $50,000 received an average tax cut of 18.2 percent.”
In regards to Pelosi’s contention that TCJA would create a “permanent plutocracy,” the TCJA actually increased economic mobility.
As Haskins notes, “The IRS data further show that the Tax Cuts and Jobs Act appeared to have a strong upward effect on economic mobility. The number of filers with an adjusted gross income of $1 to $25,000 decreased by more than 2 million in just one year, while the number of households reporting incomes higher than $25,000 increased in every income bracket.”
And, concerning the left’s unyielding claims that TCJA would be a windfall for the wealthy, there is this inconvenient truth, “The IRS data also revealed that higher-income earners paid an even larger share of the total tax burden in 2018 than they did in 2017, indicating that the Tax Cuts and Jobs Act may have made the tax code slightly more progressive.”
What’s more, “In 2017, filers earning $500,000 or more paid 38.9 percent of all personal income tax revenues. In 2018, the same income bracket paid 41.5 percent of total income tax revenues.”
When it comes to the left’s outrageous lies about the Tax Cuts and Jobs Act, I cannot help but think of John Adams’ famous quip, “Facts are stubborn things; and whatever may be our wishes, our inclinations, or the dictates of our passion, they cannot alter the state of facts and evidence.”
