The Republican Tax Plan Is Even More Devastating to the Poor Than Previously Thought
A new analysis from the Congressional Budget Office updates its findings on the Senate Republicans' tax cuts bill, finding that it hits lower-income people much harder than originally estimated. That's because it includes the repeal of the Affordable Care Act's individual mandate, and would result in 13 million people losing health insurance. Oh, and it would add $1.4 trillion to the deficit in the next ten years, which Republicans would use as an excuse to hurt poor people even more.
The Senate Republican tax plan gives substantial tax cuts and benefits to Americans earning more than $100,000 a year, while the nation’s poorest would be worse off, according to a report released Sunday by the nonpartisan Congressional Budget Office. […]
By 2019, Americans earning less than $30,000 a year would be worse off under the Senate bill, CBO found. By 2021, Americans earning $40,000 or less would be net losers, and by 2027, most people earning less than $75,000 a year would be worse off. On the flip side, millionaires and those earning $100,000 to $500,000 would be big beneficiaries, according to the CBO’s calculations. […]
The main reason the poor get hit so hard in the Senate GOP bill is because the poor would receive less government aid for health care. […]
Many of the people who are likely to drop health insurance have low or moderate incomes. If they drop health insurance, they will no longer receive some tax credits and subsidies from the government. The Joint Committee on Taxation (JCT), the other official nonpartisan group that analyzes tax bills, put out a similar report showing how lower-income families are hurt by the loss of the health-care tax credits. But the CBO goes a step further than the JCT. The CBO also calculates what would happen to Medicaid, Medicare and the Basic Health Program if the Senate GOP plan became law. The CBO is showing even worse impacts on poor families than the JCT did.
Republicans will argue that the loss of health care doesn't count, because if people "choose" not to purchase health insurance, that's not their problem, never mind that the "choice" of whether or not to buy it will come down to whether or not they can afford it for millions. And 13 million will have to "choose" that they can't continue to buy it. So lower-income people aren't really losing money, they say. Just health care.
Republicans asked the JTC to analyze just the tax cuts part, without taking into account the effects of repealing the ACA's individual mandate, and it did find a most tax cut for everyone—until 2026 when many provisions expire. After that, everyone earning less than $75,000 would end up paying more. But Republicans have an answer to that, too. Future congresses, they say, wouldn't let those tax cuts expire. Trust them, they say.