Government Watch / Politics

Democrats’ Crippling $3 Trillion Tax Hike on Working Families and Small Biz Kills Jobs and Cures

tax

Democrats are moving forward with their $3 trillion tax increase on working families and small businesses to fund the greatest expansion of the welfare state in most of our lifetimes. Worse, it even wastes tax dollars on subsidies to the wealthy and special interests. Here is a quick run-through of some of the worst parts of this bill.

Democrats Break Promises and Raise Taxes (and Utility Prices) on Middle Class

Democrats’ tax increase will hit working families hard, and will result in higher consumer prices, fewer jobs, and lower wages. This is despite President Biden’s pledge not to raise taxes on the middle class.

  • The Joint Committee on Taxation says that more than 66.3 percent of the corporate tax burden would be borne by lower- and middle- income taxpayers, and 172 million taxpayers would bear the burden of the increased corporate tax rate. The left-leaning Tax Policy Center agrees.
  • Customers will bear the cost of corporate income taxes in higher prices – paying more for everything from groceries to utilities.
  • Workers bear 70 percent of the corporate income tax in the form of wages and employment. Similarly, a 2020 study by the National Bureau of Economic Research found that 31 percent of the corporate tax falls on consumers.

Democrats Target Main Street Businesses

American small businesses struggled throughout the pandemic, so the last thing they need are Democrats’ crippling tax hikes.

  • Millions of Main Street job creators will be left shouldering the burden of Democrats’ small business tax hike.
  • The majority of the more than 30 million small businesses in the U.S. are pass-through entities in which tax obligations are passed to the owners. Pass-through businesses also account for over half of all private sector workers. More than half of all pass-through income would be taxed at this new, higher rate.
  • Democrats are expanding the death tax to hit more small businesses–and to take more from them. This trojan horse for a supercharged second death tax will force family-owned businesses to sell off assets in order to pay a massive tax bill to the IRS. These tax changes will cost 1 million jobs over the long term.
  • The Biden Administration has claimed that the majority of small businesses will be exempt from his tax hikes – but the Tax Foundation has said that’s “misleading.” In fact, almost 900,000 small businesses could be hit with Democrats’ limitation of the passthrough deduction based on 2018 IRS data.

Democrats’ Economic Surrender Makes It Better to be a Foreign Company or Worker than an American One

Democrats’ global minimum tax makes it better to be a foreign worker or company than an American one–putting American companies at a disadvantage to foreign competitors.

  • Democrats are seeking a corporate tax rate that is higher than Communist China’s, and a tax on American companies’ foreign earnings that’s higher than our competitors.
  • According to the National Association of Manufacturers, the Biden Administration’s global minimum tax would destroy up to 1 million U.S. jobs.
  • American companies would pay this higher global minimum tax for operating abroad while also paying Democrats’ higher corporate rate for operating at home—making America even less competitive and driving jobs, manufacturing, research, and investment overseas.

Democrats’ Obamacare Expansion Ignores the Rising Cost of Care, Harms Seniors, Neglects Telehealth

Democrats will kill up to 100 life-saving cures by importing socialist price controls from foreign countries to the American market, stifling innovation and future cures for patients, so they can instead spend hundreds of billions to prop up Obamacare. This new coverage could cost workers up to 10 times per person the amount of their coverage. This isn’t about expanding coverage, but instead artificially supporting their highly flawed law that hasn’t delivered on its promises.

  • Democrats are chasing ever increasing costs with ever increasing spending, raised at the expense of fewer cures. To compound this waste, Democrats will spend $170 billion to permanently remove income restrictions on ACA subsidies, which means taxpayer dollars could flow to wealthy Americans.
    • For example, a 64-year-old couple in Kay County, OK earning $500,000 per year, would qualify for a premium tax credit of almost $6,000.
  • Government price controls and the threat of huge tax increases will dramatically hurt innovators’ ability to research and develop cures for Alzheimer’s, ALS, and cancer. The costliest cure is the one that never got developed.
    • Fewer new medicines are available when governments set the cost. Today, Americans have access to all 270 global new medicines that have been discovered from 2011-2018. In Canada, hardly half of patients have access to these cures.
  • Yet, Democrats, amongst $3.5 trillion in spending, couldn’t find a single dollar to ensure seniors will have continued access to telehealth when the COVID-19 public health emergency ends. Telehealth has been vital to improving access to care among seniors in rural and underserved areas.

Democrats Bring Special Tax Credit Circus Back from the Dead

Despite a historic end-of-year bipartisan agreement to end the special interest tax credit circus, Democrats are bringing back special tax credits for political priorities, including tax credits for which wealthy owners of electric vehicles qualify.

  • A person making $800,000 a year would qualify for a 12,500 tax credit for an electric BMW or Mercedes. Cost: $16 billion.
  • Those earning over $160,000 a year can get a rebate for e-bikes up to $1,200. Cost: $7.5 billion.
  • Creating a special activist workforce to pursue environmental justice – Cost: $15 billion.

Democrats Ignore Rampant Fraud By Expanding Wasteful Tax Credits

Even though an astonishing amount of Americans’ hard-earned tax dollars are wasted in improper tax credit payments, Democrats are expanding problematic tax credits without any reforms.

  • In 2015, the IRS made $15.6 billion (23.8% of all payments) in improper Earned Income Tax Credit (EITC) payments.
  • In 2019, that number increased over time to $17.4 billion (25.3% of all payments) in improper EITC payments. A concerning pattern also exists for Additional Child Tax Credit (ACTC).

The Child and Dependent Care Tax Credit is being expanded at a cost of $98 billion through 2025, and the Earned Income Tax Credit’s expansion will be made permanent for $135 billion.

Reprinted with Permission from - US Committee on Ways and Means by - J.P. Freire, Jessica Henrichs, & Leo Lutz

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PIDL
2 days ago

I removed a good amount of money from my 401K so I could pay off bills and retire comfortably. My Medicare went to over $400 a month. And I am by no means rich. And now they are talking about paying rich people on Obama care? This really sucks.

PaulE
2 days ago
Reply to  PIDL

Medicare has a number of rules and regulations that are aimed at punishing anyone that has any sort of retirement income much above just Social Security alone. Medicare takes a look at your annual tax returns to calculate the amount they will charge you in Medicare premiums. When you pulled out that “good amount of money” from your 401K, you created a situation where Medicare saw the additional income as putting you (temporarily) into a higher income bracket for Medicare purposes and re-priced your premiums accordingly. If your income over the next two years goes back to the pre-income levels you had before the 401K withdrawal and stays there, Medicare should reduce your monthly premium back down to close to what you were paying before.

Both SS and Medicare are really designed to punish anyone who really has more income than just straight SS alone. That is the unspoken truth of how the two systems were designed. In the future if you want to pull out more money from your 401K, I suggest you either read the income guidelines for Medicare or talk with your tax professional, so you afford this from happening again by taking out amounts that keep you under some of the more onerous income caps.

Hope this helps.

Last edited 2 days ago by PaulE
Bill on the Hill
2 days ago
Reply to  PaulE

That is the key Paul & there is very little discussion on this subject. Taking out just enough to live comfortably from one’s retirement accts. as a supplement to SS, but keeping oneself under the taxable thresholds is the smart way to avoid the tax man…
Live comfortably but not high on the hog so to speak or put another way, living within your means…
Bill on the Hill… :~)

PaulE
2 days ago

Most people don’t realize that the government doesn’t give you anything without a whole bunch of potential minefields out there attached to those benefits. Like anything else in life, people need to take the time to fully understand how those government programs seek to punish even a moderate amount of financial success.

Honestly, if both programs were designed properly, there should be no difference in how much money anyone has in retirement. It’s none of the government’s business how successful one was in their working career. We paid a tax as required by law and should be able to access the benefits without financial bias. Instead both SS and Medicare are already heavily means tested to trip up anyone not simply scrapping by on SS alone, which reeks of the typical social engineering associated with Democrat created programs. In poor PIDL’s case, he learned the hard way that the federal government hates anyone with any assets above welfare level.

Last edited 2 days ago by PaulE
BILL T
2 days ago

Why stop now? Hit em hard and make sure this is it(totally destroy our free society and have the Harvard educated ELITES control everything!! They actually despise all of us deplorable non union independent citizens and you simply don’t deserve or really understand what’s good for you ! We’ll figure that out as we go and after a total collapse of our country and we’re in complete free fall then your on your own (oop’s sorry about our miscalculation’s andCHINA we’ll be more than glad to take us and everything else over , don’t conform and guess what? We’re basically there already just a few small adjustments required and BAM! We’re already basically finished with this declaration of war against our country, woke up American! Or did I mean WAKE UP RIGHT NOW!

J. Farley
3 days ago

Not to weary, the DEMOCRATS know that CHINA will bail us out, FOR A PRICE, a very hefty price. How many dialects of Chinese do you speak, we might have to learn at least just one.
God help use and God save America.

CaRepub
3 days ago

This is not the party called the “tax and spend” party without reason. They have had that label since before I could vote back in the 60s. And as bad as their continual assault on working folks was all those years ago was, they are nothing like the current band of liars, cheats, and non-American socialist globalist currently doing their damnedest to destroy America. Anyone in this country actually believing Blowhard Joe about his taxes only effecting the rich had to be dumber than a brick. All Dem voters.
We all better start digging in for the next election helping candidates you want in any way you can. Otherwise the outcome will be the same as the failed attempts to get rid of the cancer of California, Prince Gavin. The time to mobilize and start digging is now……..

CoNMTX
3 days ago

The plan is to destroy America, drive us to rock bottom, then rebuild socialist as part of the one-world government. The demo/globalists are Godless, evil, & wicked. They care nothing about humanity of any race or color. Power & control is their only goal.

Tom Hatch
3 days ago

Perhaps this is the plan to put the country into a deep recession or depression. With that crisis the government takes even more control and that could lead to a place you may not enjoy living in. It will not be utopia but a hellhole of socialism.

Sharon
3 days ago

Please Please read this. Something has to be done to stop this takeover. This is AMERICA soon to be like CHINA!!!!! What is happening is illegal. Why can’t the courts stop this????

Blondie
3 days ago

This is what the Biden supporters wanted. He said he was going to raise taxes and they voted for it. If it costs them, so be it, I better not listen to them cry about it. The stupid fools that voted for Socialism, don’t realize that most people that flee to the US are fleeing from countries that are Socialist or Communist, and there is no where to run. Thanks alot, morons.

MIKE FAILLA
3 days ago

You dont really think biden and his henchmen really give a (censored) about what you, the peons of this country care or think? Pay up and shut up is their credo. Remember, you, the voters, you voted for this and probably voted more than once for this moronic dictatorship led by the moronic puppet being contolled behind the scenes by who exactly? I have my suspicions. Everything they claimed trump was guilty of they are doing in triplicate. Arent you tired of being lied to by these marxist apparatchiks?

Jeanne
3 days ago
Reply to  MIKE FAILLA

I didn’t vote for this and I don’t believe it was an election at all. I don’t think the majority of Americans did vote for obiden. They are socialist/communist. The were installed.

Joanne
3 days ago
Reply to  MIKE FAILLA

I’m with you. I just don’t get it with people voting for these morons. I live in California and am so disgusted with Newsomes win!!! All I can say is I don’t think any of this socialist agenda is going to change. I plan to retire next year and will cash in everything I own and bury my cash under the mattress and definitely get out of California

Raes
3 days ago
Reply to  Joanne

They are coming after Texas…I am sincerely sorry that Larry Elder didn’t win…he is a good man…I prayed and prayed…but God has other plans…you will be welcome in Texas…but Seniors are also feeling the pain of high prices…it has to be a little better here…keep the Faith…

CoNMTX
3 days ago
Reply to  MIKE FAILLA

The demo/globalists are totally evil. But if Biden croaks or the demos get rid of him, you’ll see evil on steroids when Kamala takes over.

R.J. from Arizona
3 days ago

The sad part is that there are millions of stupid Americans who believe what socialist party tells them and think biden is wonderful.

Lawrence Greenberg
3 days ago

As Biden and the Communists – er, I mean the Democrats – keep saying over and over how they are doing all they can to create jobs and help the middle class, all of their actions are clearly doing everything possible to kill jobs and destroy the middle class. Are you going to believe those who lie to us 24/7/365 or your own lying eyes?

CoNMTX
3 days ago

Remember, the demos stock in trade is to lie, lie, lie.

Hal
3 days ago
Reply to  CoNMTX

And force, rig, coerce, deceive, lie, confuse, bribe, cover-up, conceal …. all DemocRat strategies to get the News Media to put out their propaganda.

PaulE
3 days ago

The actual cost of the bill is $6 trillion, not $3.5 trillion. Congress has always low-balled the cost of their spending bills in order to not shock the public. Although in this case, even their low-ball number is an eye popper. Even so, both Bernie Sanders and AOC have said recently that this is just a initial down payment and that more bills of this nature will be needed to fulfill the dream.

Multiple independent firms have already scored the real cost of the bill at $6 trillion and rising, since the Democrats keep plugging in items into the bill.

Lawrence Greenberg
3 days ago
Reply to  PaulE

Hey, what’s a couple of trillion between friends?

Last edited 3 days ago by Lawrence Greenberg
PaulE
3 days ago

When we’re the ones ultimately footing the bill via increased prices on everything, higher taxes and cost new regulations, it matters.

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