Kansas Congressman Kevin Yoder is offering a vigorous defense of the Republican tax cut bill as the U.S. Senate prepares to vote on its version of the controversial measure.
In a lengthy news release posted Thursday that Yoder touted as separating myth from fact, the 3rd District representative said the bill does not favor wealthy taxpayers over middle-class families, as Democrats and other critics claim.
Noting that most taxpayers do not itemize, Yoder said critics are making too much of proposals to reduce or eliminate some deductions to offset the cost of a sharp reduction in the corporate tax.
In particular, he argues that middle-class families, which he defines as those making the median income of $59,000, would not be adversely affected by the House proposal to cap the itemized deduction for state and local taxes at $10,000 or the Senate plan to eliminate it.
“The middle class is by and large not benefitting from the state and local tax deduction,” Yoder said in the release, noting that most middle-income taxpayers do not claim itemized deductions.
“We significantly lower the tax burden for middle class and low-income Americans by doubling the size of the standard deduction — making the first $24,000 in a family’s income and the first $12,000 of an individual’s income tax-free,” he said, noting that the measure also preserves tax credits that generally help low-income families.
‘Toward an economic cliff’
But critics of the bill insist that wealthy Americans will benefit the most, noting that reductions for individuals would be temporary while corporate tax cuts would be permanent.
“The (Republican) party is now trying to pass a scam that throws a few crumbs to the middle class (temporarily — millions of middle-class Americans will soon see a tax hike if the bill is enacted) while heaping benefits on the super-rich, multiplying the national debt and endangering the American economy,” historian Robert McElvaine wrote in the Washington Post.
McElvaine, the author of a book on the Great Depression, sees echoes of the policies that precipitated the 1929 crash in the current GOP tax cut bill.
“Nine decades later, Republicans are rushing to do it again — and they are sprinting toward an economic cliff,” McElvaine wrote while warning of “catastrophic” results.
An analysis released Thursday by the nonpartisan Joint Committee on Taxation is also creating problems for Senate GOP leaders and Trump administration officials who have claimed the tax cuts would generate enough growth to largely offset the bill's cost. The JCT report estimated that the cuts would only boost revenues by about $400 billion, meaning that the bill would add nearly $1 trillion to federal budget deficits over the next 10 years.
Critics of the bill say reducing the tax rate on “pass-through” business income is another way it benefits the wealthy by taxing them at a lower rate than many middle-class Americans. And they often point to Kansas Gov. Sam Brownback’s failed tax-cutting experiment as evidence that such “trickle down” policies don’t work.
"Kansas is just now emerging from the damage caused by a similar failed tax plan," said David Jordan, director of the Alliance for a Healthy Kansas. "Kansans know better than most that we cannot afford this tax reform."
Different than Kansas plan
Yoder said it’s unfair to compare the GOP tax bill to the Brownback plan, which state lawmakers largely repealed last session.
For one thing, he said the federal bill would only reduce taxes on pass-through business income, not exempt it as Brownback’s plan did.
“Our plan reduces the federal rate to 25 percent, which will allow American small businesses to compete at a level similar to that of other nations around the world without irresponsibly eliminating taxes all together,” he said in the release.
Yoder’s defense of the tax bill Thursday comes as the U.S. Senate is nearing a vote on its version.
Kansas Republican Sen. Pat Roberts supports the measure. But the state’s other GOP senator, Jerry Moran, has expressed concerns about its projected impact on the federal budget deficit and provisions that would tax the university tuition waivers of graduate teaching assistants and repeal the Obamacare requirement that Americans purchase health coverage.
In a statement on his website, Moran said he is still “discussing ways to improve” the bill but is likely to vote for it regardless of the outcome of those discussions.
“I expect to support a tax package that grows the economy, protects taxpayers, creates good-paying jobs and helps Americans keep more of their hard-earned money,” Moran said.
Jim McLean is managing director of the Kansas News Service, a collaboration of KCUR, Kansas Public Radio, KMUW and High Plains Public Radio covering health, education and politics. You can reach him on Twitter @jmcleanks. Kansas News Service stories and photos may be republished at no cost with proper attribution and a link back to kcur.org.