True-false quiz on tax bills
My fellow citizens,
The House of Representatives has now passed its version of the so-called tax-reform bill. The Senate has a different bill, but both bills will get conformed soon. We voters should know how the proposed tax reform will affect each of us.
Here are some true and false questions to test your knowledge. Which of the following are true or false about the two bills as currently drafted?
1. They give the top 1 percent of all taxpayers 25 percent of the tax cuts.
2. They give a tax increase to more than one-quarter of our middle-class taxpayers.
3. The current repeal of the individual mandate will cause 13 million people to lose health care as premiums spike.
4. Both bills would add $1.5 trillion to the already staggering $19 trillion federal deficit.
5. In 10 years everyone except corporations and the very rich will have a dramatic tax increase.
6. Automatic pay-as-you-go rules will cut up to $25 billion from Medicare.
7. Both house bills would subsidize private jets.
8. Most local and state tax deductions will go away, especially hurting blue states like New York.
9. Students will lose tax deductions for their student loans.
10. Grad students working as teaching assistants will have to pay taxes on their tuition forgiveness, adding many thousands of dollars to the cost of creating our doctors, teachers and researchers.
11. Teachers will no longer get a deduction for supplies they buy out of their own pockets.
12. To stay revenue-neutral, the rest of us will have to fork over $20 billion a year to replace estate taxes on the families of the 5,500 very rich people who die each year.
13. Both House bills preserve the so-called carried interest tax break that subsidizes hedge fund millionaires.
14. The tax reforms proposed will stimulate the economy.
Answer: While some of these may change as the Senate and House versions are reconciled, only No. 14 is almost certainly false.
Our economy is already red-hot, stock markets are at all-time high valuations, and unemployment is testing all-time lows. Many economists argue that further economic stimulation at this point could be counter-productive. So from the economy s standpoint, revenue-neutral tax reform makes sense, but a massive giveaway to the wealthy does not.
The main purpose claimed for the so-called reform is to give corporations lower tax rates, thus stimulating growth and making America more competitive. But as we recently learned in the Paradise Papers, supposedly American companies like Apple are having no trouble sheltering trillions of dollars made abroad from U.S. taxes by stashing funds in offshore havens like the Isle of Jersey. Under our admittedly byzantine tax code, the average American corporate tax rate is only a few percent above the administration’s 20 percent goal, making this exercise seem rushed and maybe pointless.
So I pose one final question: Is the rush toward tax code reform really about reform, or is it about shifting even more money from the poor, sick and middle classes to the already wealthy? You be the judge, and let your congressional representatives know what you think before we meet them again at the polls.
And for the record, both bills as currently proposed would directly benefit me and my family, so in theory we should be in favor. However, I do not, and we do not, want to live in a country where some of us live better at the expense of our poorest and most vulnerable citizens.
Lee Keet lives in Saranac Lake