One year ago, as many Americans were in the midst of holiday celebrations and preparations, Congress and President Donald Trump stuffed the stockings of corporations and the super-rich with tax giveaway goodies. Despite the hard-fought efforts of Public Citizen and our allies, the “Tax Cuts and Jobs Act”, signed into law one year ago today, contains innumerable items from the 1%’s wish list. Here we catalogue the top five undeserved presents gifted to corporations and the wealthy.
1. Sweets for lobbyists
Our “Swamped” report showed how much corporate America was investing in making sure their holiday wishes came to fruition: more than 60 percent of the registered lobbyist in D.C. lobbied on the bill. That’s 7,088 lobbyists in total. Industries like Big Pharma and financial firms topped the list of lobbyists by number and ended up as some of the tax bill’s most handsomely-rewarded sectors.
2. Globetrotting profits
Certainly getting a round-the-world vacation for a holiday present would probably be the best gift most of us could imagine. That’s just what corporate profits got when last year’s tax giveaway plan included a provision that worsened the problem of multinational corporations stashing their profits on the books of their foreign subsidiaries incorporated in tax haven nations. Now, the taxes multinational companies pay on the profits made in other countries is at most half of what corporations pay on profits made in the U.S. And, the more physical operations corporations have overseas, the less they pay. Some workers are already feeling the hurt- like the GM workers who got a pink slip for their holiday “present.”
3. An economy further rigged without care
Billionaires and other who’s who of Whoville made out like the Grinch in last year’s tax bill and sucked up even more wealth into their overstuffed moneybags. Not only did the bill lower the top tax rate that the richest folks have to pay, multimillionaires and their heirs now have more money to grab. The value of gifts and inheritances that won’t be subject to tax were doubled — up to $11 million and $22 million for couples.
4. Heaping helping of self-dealing
Politicians, especially those that like the Trump make a lot of their money through LLCs and other entities known as “pass-throughs,” gave themselves a great gift when they included a huge deduction for those types of companies in last year’s tax bill. Until Trump’s tax returns are disclosed, we cannot know the extent to which he and his family personally benefitted from the tax changes—but it’s clear the Trumps saved a huge amount. Luckily, the incoming House leadership have pledged to address disclosures the President’s tax returns as one of the first items on their agenda for the new Congress and the Ways & Means committee plans to request his tax return information as well.
5. The “gift” that keeps on “giving”
It is clear workers didn’t get the actual gift they were promised from the tax bill—a magical $4,000 check. Instead, corporations self-gifted stock buybacks to boost investors’ stock values and CEOs’ resulting bonuses. Unfortunately, like a phantom from A Christmas Carol, the harmful outcomes of the bill will likely haunt working Americans for Christmases yet to come. The Affordable Care Act’s requirement for insurance is gone because of the bill, meaning an estimated 13 million Americans will end up being pushed out of insurance while premiums will increase for the rest of us. And, the tax giveaways tied a huge red bow on the top of the federal deficit by increasing it by $2 trillion. And, the naughty boys and girls in Congress want to use these budget shortfalls to enact miserly cuts to critical government services like Medicare, public education, and nutrition assistance. Moreover, come Tax Day 2019, a large number of us might be receiving a tax bill instead of a return because of under withholding.
So, here’s to ringing in the New Year with a new tax plan that discloses Trump’s tax returns, repeals the giveaways to corporations and the wealthy, and that prioritizes growing new revenues (for example, by taxing Wall Street trades) in order to invest in American communities to create a just country for all of us.