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With Further Analysis Completed, it’s Time to Call the GOP Tax Plan What It Is: Welfare for the Wealthy



A 50-state analysis of the House tax plan released last week reveals that in Arizona the wealthiest 1% of Arizonans will receive the greatest share of the total tax cut in year one and their share would grow through 2027. And during that 10-year window, the value of the tax cut gets smaller and smaller for every income group except for one: the very richest Arizonans (see Tables 1 and 2 at end of this release).

“House leadership continues to tout this bad tax proposal, which will increase the federal deficit by $1.5 trillion over the next decade, as a plan to boost the middle class, even though the numbers clearly show it will do no such thing,” said David Lujan, Director of The Arizona Center for Economic Progress. “And for Arizona, this plan will do almost nothing for everyday Arizonans and small business owners while jeopardizing many critical services for people across the state.”

The more analysis completed on the bill, the more one thing becomes evident: the bill’s provisions are laser-focused on tax cuts for the nation’s highest earning households. In Arizona, the wealthiest share of tax cuts would grow over time due to phase-ins of tax cuts that mostly benefit the rich and the eventual elimination or erosion in value of provisions that benefit low- and middle-income taxpayers. For example, after five years, the bill eliminates a $300 non-child dependent credit that benefits low- and middle- income families while fully repealing the estate tax in year six for the very large estate subject to the tax.

More specifically, the 10-year outlook for the plan reveals that by 2027, the top 1% of households in Arizona share of the tax cut would increase from 30% in year one to 45% by 2027, for an average cut of 3.2%. Everyone else would see an average tax cut of only 0.6% by 2027 – less than 1/5th the amount the top 1% will see.

“The fact that the top 1% of households will receive 45% of the tax plan’s benefits by 2027 is astonishing,” continued Lujan. “These tax cuts that mostly benefit top earners will add to the nation’s annual deficits and come at the expense of low- and middle- income families who will likely lose more from cuts to education, health care,

infrastructure or other public services than they gain from the small cuts they would receive. This plan is nothing more than welfare for the wealthy.”

To read the entire report or get more details about Arizona, go to

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Contact

The Arizona Center for Economic Progress
3030 N. 3rd St., Suite 650
Phoenix, AZ 85012
602.266.0707
AZEconCenter.org


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