fbpx

Proposed Federal Tax Cut 2.0 will not help North Carolinians. Here are three things to know

What is happening?

Under the heading “Tax Reform 2.0,” the House Ways and Means Committee has introduced new proposed legislation that follows the federal tax plan that was passed into law by President Trump late last year. The proposed Tax Cut 2.0 would permanently preserve a number of provisions that went into effect in 2018 and are currently scheduled to “sunset” after 2025.

The House is expected to begin the voting process as early as next week (September 24).

Why is this concerning?

The Congressional Joint Committee on Taxation estimates the bill “Protecting Family and Small Business Tax Cuts Act of 2018,” would reduce federal revenue by $631 billion in the next decade (2019-2028) and an additional $3.15 trillion between 2029-2038. Furthermore, this proposed second round of GOP tax cuts would add $3.8 trillion to the federal deficit over the next two decades, according to a report released  by the Urban-Brookings Tax Policy Center.

In other words, the proposed federal tax cut 2.0 would mean a further cost shift to the states and paves the way for even more significant reductions in the federal programs and services that ensure the economy is functioning efficiently and effectively, and that more people are connected to opportunities.

What happened last time?

The last time Congress rushed a federal tax plan was last year when in 2 months it rushed a tax law at a cost of $1.9 trillion over the next ten years. As a result our country’s tax code has now been changed in a way that benefits wealthy taxpayers and foreign investors while asking more from low and middle-income taxpayers. In North Carolina the richest top 5 percent received half of the total tax cut benefits. Meanwhile, the poorest 20 percent only received 1 percent of the benefits.

Luis A. Toledo is a Public Policy Analyst for the Budget & Tax Center, a project of the North Carolina Justice Center.

Load More Related Articles
Load More By Luis Toledo
Load More In NC Budget and Tax Center

Top Stories from NCPW

  • News
  • Commentary

For 28 years, Roverta and Franklin have owned a spacious mobile home and a lot in… [...]

WASHINGTON — Another grueling summer disaster season is arriving, and the Federal Emergency Management Agency is… [...]

Duke Energy's proposed carbon reduction plan calls for steep cuts in carbon dioxide, a major greenhouse… [...]

Five Republicans vying to win control of Durham’s progressive school board were soundly defeated in Tuesday’s… [...]

As most voters have shown they understand, Roy Cooper has been one of the best governors… [...]

We had been married a little over a year when I had an abortion. Put down… [...]

The post Not a good fit. appeared first on NC Policy Watch. [...]

During a 2014 symposium marking the 60th anniversary of the Brown v. Topeka Board of Education… [...]