Re-elect Dan Lipinski Congressman

Local Dems Decry Tax Plan as Failing Middle Class

12/19/2017

Local Democrats in Congress said the sweeping tax bill passed by the House Tuesday afternoon offers little in the way of substantive help for virtually all middle-class taxpayers.

U.S. Rep. Robin Kelly, D-Matteson, and U.S. Rep. Dan Lipinski, D-Western Springs, both of whom voted against the measure, also expressed concern that the speed with which the legislation advanced could mask other details that might not be beneficial for many taxpayers.

"I don't think it was tax reform," Kelly said after the 227-203 House vote. "It gives tax cuts for the people who need it the least."

Lipinski said that the bill "fails the middle class badly."

The Senate was expected to take up the bill Tuesday evening or at some point Wednesday, but it appeared the measure would need to be modified in some fashion in the Senate before being sent back to the House for another vote.

Hefty tax cuts for corporations would be permanent while those for individuals would sunset after 2026 in order to comply with budget rules.

The standard deduction used by most families would nearly double, to $24,000 for a married couple, although those who itemize would see some deductions scaled back.

Tax cuts would kick in next month and workers would begin to see changes in the amount of taxes withheld from their paychecks starting in February.

Lipinski said there would now be a $10,000 cap on deductions for things, such as property taxes and state income taxes that will hurt those who itemize, which he said is about a third of taxpayers in his 3rd District. That cap comes as Illinois is raising the personal income rate, he said.

"Taxpayers in Illinois send more money to the federal government than we get back and this is only going to make this worse," he said.

Republicans contend that lowering tax rates for businesses will spur them to create more jobs, and groups, such as the National Federation of Independent Business calling the Tax Cuts and Jobs Act a "once-in-a-generation achievement."

The Illinois Farm Bureau also said it welcomed House passage, saying the bill "will enable most farms to reinvest and grow their businesses."

"Tax reform was long overdue. It has taken on added importance now as farmers experience a fifth consecutive year of declining net farm income," Richard Guebert Jr., the bureau's president, said in a statement.

In the form passed by the House, the bill would cut the corporate income tax rate from 35 percent to 21 percent, and the top tax rate for individuals would be lowered from 39.6 percent to 37 percent.

The $1,000-per-child tax credit doubles, to $2,000, and the measure would also do away with the Affordable Care Act requirement that all Americans carry health insurance coverage or face a penalty.

The tax cuts are projected to add nearly $1.5 trillion to the nation's debt over 10 years.

On Twitter, U.S. Rep. Bobby Rush, D-Chicago, called the measure "dangerous and reckless" and one that "only benefits the wealthy and big corporations."

In a statement, U.S. Rep. Bill Foster, D-Naperville, described it as "a massive Christmas gift to large corporations and wealthy campaign donors that is paid with more than $1 trillion in new debt that our children must repay in the future."

Citing an analysis by Congress' Joint Committee on Taxation, Lipinski said that individuals and households with annual incomes of $20,000 to $100,000 would reap about 4 percent, or $61 billion, of the total tax benefits included in the bill.

"It's a small amount, it goes away after 2026," he said.

Lipinski and Kelly said that due to the sheer size of the bill and how quickly it advanced, they doubted many in Congress have a full understanding of the implications of it.

"One-thousand pages were just put out Friday evening," Kelly said. "It is a matter of 'The devil is in the details.'"

"This was done extremely quickly, there were no hearings on it and it was negotiated behind closed doors," Lipinski said. "There are things we are going to find out, loopholes that we haven't spotted."


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