The Republican-led House of Representatives passed Tax Cuts 2.0, (H.R. 6760/H.R. 6757) in late September. If the Democrats win back the House of Representatives, there is a strong possibility that the Senate would try to find a way to ram Tax Cuts 2.0 through their chamber. Even if they can’t get the whole bill through, there is a possibility that they would try to attach parts of it to other bills that are moving through the senate.
Tax Cuts 2.0 is a multi-trillion-dollar tax plan that is an irresponsible giveaway to the wealthy and corporations— paid for on the backs of working families — and jeopardizes the ability of states and local communities to adequately fund public schools.
It will balloon the deficit and will cost $2.8 trillion over 10 years, setting the stage for deeper cuts to Medicare, Medicaid, Social Security, and education. Like last year’s tax cuts, the new cuts will not increase wages, create good-paying jobs, or reduce inequality — creating an even deeper divide in favor of the wealthy and corporations.
Even before Tax Cuts 2.0, Trump Administration economic advisors are already saying that spending needs to be cut. We have seen this before, shortly after the enactment of the first tax cuts there were proposals to shrink the deficit by cutting trillions from Medicare, Medicaid, the Affordable Care Act, and SNAP.
Working families will not see financial benefits from this tax plan, just as they did not see benefits from last year’s tax cuts; 96 percent of workers did not receive an increase in wages or a bonus. Meanwhile, the nation’s six biggest Wall Street banks are going to save an estimated $12 billion in taxes in 2018.
The bill would also make permanent the $10,000 cap on the state and local tax (SALT) deduction for individuals and families, but not businesses. Continuing to cap the SALT deduction could have a negative, ripple effect on the ability of states and local communities to adequately fund education and other essential public services. In turn, that could translate into cuts to public schools, lost jobs, and overcrowded classrooms that deprive students of one-on-one attention.
This bill would further expand the 529 savings program to cover homeschool expenses. As with the expansion of 529s to cover private K-12 education in last year’s tax bill, expanding this savings vehicle to include homeschools simply rewards those who are already making the decision to homeschool and would further reduce available funds for public education.