One of the key moments of Tuesday night’s presidential debate was Joe Biden promising twice! to raise taxes on everyone, including the middle class.
“That’s why I’m going to eliminate the Trump tax cuts,” Biden said during his first of three debates with President Trump. And then, to accentuate the point, he said it again, “I’m going to eliminate those tax cuts.”
Let me repeat what he said in full: “That’s why I’m going to eliminate the Trump tax cuts. And I’m going to eliminate those tax cuts.”
No gray area, no ambiguity, no caveat.
Oh, and if Biden intends to eliminate the Trump tax cuts altogether, if he does what left-wing governors like Andrew Cuomo want done, while Biden is raising taxes on the middle class, he will be lowering taxes on the wealthy.
But let’s start with Biden’s promise to raise taxes on the middle class…
Here are the facts…
If you “eliminate the Trump tax cuts,” you raise taxes on the middle class.
You cannot eliminate the Trump tax cuts without raising taxes on the middle class, because the Trump tax cuts cut middle class taxes.
The Trump tax cuts, officially known as the Tax Cuts and Jobs Act of 2017 (TCJA), were a boon for the middle class in how they practically doubled the standard deduction for singles from $6,350 in 2017 to $12,000 in 2018; nearly doubled the standard deduction for married couples from $12,700 to $24,400, and bumped up the child tax credit up from $1,000 in 2017 to $2,000 in 2018.
If you eliminate the Trump tax cuts, you slash those deductions on working people and families almost in half. That’s a huge tax increase because then, for example, a married couple will be paying federal taxes $11,700 in income they weren’t paying under the TCJA. So if your federal tax rate is, say, 20 percent, that’s an annual tax increase of around $2300.
Now get this…
The TCJA also raised taxes on the rich by capping the wealthy’s ability to deduct their state and local taxes from reported federal income to just $10,000.
Before the TCJA closed this obscene loophole, the rich were able to deduct every penny of their local and state taxes from their federal income. It was an unlimited deduction, so whatever the wealthy paid in local taxes, was deducted and they paid no federal income tax on that amount.
For instance, let’s say Sean Hannity, who lives in New York, pays $5 million a year in state taxes. I have no idea about anything involving Sean Hannity’s income, but that is not a preposterous number… Anyway, before the TCJA, Hannity was allowed to deduct every penny of that $5 million from his federal income tax. So if his federal tax rate was 20 percent, he was paying a million fewer dollars in federal income taxes. Under the TCJA ,he can only deduct $10,000 of the $5 million from his income, which means he’s paying almost a million more in federal income tax today.
Basically, this obscene loophole allowed Democrat-run states like New York and California to impose all these staggering taxes, but the wealthy didn’t really pay all that much because they paid no federal income tax on that amount.
This essentially means federal taxpayers ended up subsidizing the wealthy’s local tax burden.
Let me repeat that this was an obscene tax cut for the wealthy, and Joe Biden sure sounds like he intends to reinstate this obscene tax cut by eliminating the TCJA.
Democrats from the far-left state of California are just as desperate to reinstate this tax cut for the wealthy and have proposed all kinds of gimmicks.
The media will focus on interruptions and lies about Trump refusing to denounce white supremacists, but this is the kind of stuff voters remember.
They remember the difference in what they were paying before the Trump tax cuts and what they pay now… and when you’re in the middle class, that can be all the difference.