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tax cuts and jobs act
Trump GOP's Tax Plans Mean Pain for Families, Windfalls for the Wealthy
One think tank urged Congress to "create a more equitable federal tax system that raises revenue sufficient to meet the nation's needs and requires wealthy households and corporations to pay their fair share."
Feb 04, 2025
As U.S. President Donald Trump and congressional Republicans plot more tax cuts for the rich at the expense of working people, a progressive think tank on Tuesday put out a policy brief detailing how those cuts and price-hiking tariffs would deeply harm working families.
The Center on Budget and Policy Priorities brief is part of CBPP's "2025 Budget Stakes" series, which also includes documents on potential "painful cuts" for "vulnerable people" and the possible loss of health coverage, food aid, and rental assistance.
"High-income households and profitable corporations would grow even wealthier under Republican proposals for trillions of dollars in new or extended tax cuts," the new report states, "even as Republican proposals for trillions of dollars of cuts to health assistance, food assistance, and other programs would leave more children in poverty, more families without stable housing, and more people without health coverage."
"As a first step, Congress should let the 2017 tax cuts for households with high incomes expire on schedule."
"The major tax law that President Trump and a Republican-controlled Congress enacted in 2017 was heavily skewed to households with high incomes," the brief continues. "It was also expensive, costing $1.9 trillion over 10 years, according to the Congressional Budget Office's 2018 estimate. And it failed to deliver the economic gains its backers promised; studies found the benefits didn't 'trickle down' to most workers."
The current debate over taxes in Washington, D.C. is happening not only because Republicans now control the White House and both chambers of Congress, but also because key parts of the GOP's Tax Cuts and Jobs Act of 2017 expire at the end of this year.
The CBPP brief warns that extending the expiring provisions from what critics called the "GOP Tax Scam" would:
- Do relatively little for households with low or middle incomes;
- Add trillions in debt, much of it to benefit the wealthy;
- Worsen racial inequities; and
- Weaken the nation's ability to fulfill our commitments to seniors and meet national needs and challenges.
The document features a section on the Internal Revenue Service, which explains that "during the 2010s, steep budget cuts imperiled the IRS' ability to serve taxpayers and enforce the nation's tax laws. But funding from the 2022 Inflation Reduction Act is helping the IRS dramatically improve its customer service, operate the direct file mechanism so people can file their taxes directly with the IRS for free, and modernize and improve its tax enforcement efforts."
"Those efforts are already paying off in cracking down on tax cheats and ensuring that wealthy people pay more of the taxes they owe," the brief notes. "But Congress has already canceled some of the new enforcement funding, and Republican budget proposals call for repealing the rest."
Although Trump on Monday struck deals with the Canadian and Mexican governments to delay 25% tariffs on goods from the United States' neighboring nations, CBPP also sounded the alarm about Trump's campaign promises regarding the taxes.
"Research shows that the extra costs imposed by these tariffs are passed on to consumers; the tariffs announced February 1 would cost a typical middle-income household around $1,200 per year, according to one estimate," the brief states. "Tariffs can also provoke trade wars, which can harm domestic businesses."
Republican proposals would deliver trillions in tax cuts benefiting high-income households and profitable corporations, while cutting health and food assistance. This would increase poverty, reduce housing stability, and raise prices through new tariffs. www.cbpp.org/research/fed...
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— Center on Budget and Policy Priorities (@centeronbudget.bsky.social) February 4, 2025 at 10:55 AM
The document argues that "instead of extending and expanding costly tax breaks for those who least need help, Congress should create a more equitable federal tax system that raises revenue sufficient to meet the nation's needs and requires wealthy households and corporations to pay their fair share."
"As a first step, Congress should let the 2017 tax cuts for households with high incomes expire on schedule," the brief says. "Congress also should expand the child tax credit, especially for the roughly 17 million children who don't receive the full credit today because their families' incomes are too low, and expand the earned income tax credit for workers not raising children in their home, who now receive little or nothing from the credit."
"In addition, Congress should scale back corporate tax breaks and reduce the special tax breaks enjoyed by very wealthy households that shield their considerable income from taxation," the report concludes. "And Congress should provide the IRS with the funding it needs to enforce the nation's tax laws and better ensure that wealthy people and corporations pay the taxes they legally owe."
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Trump and His GOP Allies Are Preparing a Tax Scam 2.0
Trump campaigned on a promise to lower costs for Americans, but instead, Republicans are laser-focused on passing another round of massive tax breaks for the ultra-wealthy and corporations.
Jan 19, 2025
As U.S. President Donald Trump takes office, his Republican allies in Congress are already hard at work readying his legislative agenda.
Trump campaigned on a promise to lower costs for Americans. But so far, the GOP hasn’t proposed a single plan to do that. Instead, Republicans are laser-focused on passing another round of massive tax breaks for the ultra-wealthy and corporations.
It’s shaping up to be 2017 all over again.
If Trump and the GOP get their way, we know exactly what to expect: Income inequality will worsen, crucial government programs will be starved, and corporations and the ultra-wealthy will amass even more outsized power over our economy and democracy.
Trump made a lot of promises on the campaign trail in 2016 too—and quickly broke most of them. But he did fulfill one: His 2017 Tax Cuts and Jobs Act, his only signature legislative accomplishment, was a field day for the oligarchs and CEOs who helped elect him.
That law delivered a tax cut for the richest 0.1% of Americans that was 277 times larger than the one teachers and firefighters got, nearly doubling billionaire wealth in this country and spiking inequality.
Meanwhile, corporations got a 40% discount on their taxes, which they used to send record stock buybacks to their wealthy shareholders and pad their profits while they overcharged consumers on everything from gas to groceries.
The bill never delivered the wage gains or economic growth Trump promised. But it did add $1.9 trillion to the deficit.
Key provisions of this tax scam expire next year. That would be welcome news for the vast majority of Americans, who are sick and tired of tax cuts for the wealthy. But Trump and his Republican colleagues are readying a supersized set of high-end tax breaks that would make his 2017 legislation look like child’s play.
Republicans plan to give the richest Americans a fresh round of individual tax breaks, slash the corporate tax rate yet again, and cut taxes on capital gains and dividends, which would let their Wall Street friends keep even more of their winnings when they sell a stock or are showered with dividends.
Then they’ll move to step two: draconian budget cuts for the programs Americans rely on.
GOP leaders will point to falling revenues from their own tax cuts as evidence for the need to cut spending on life-saving programs that families rely on, like Medicaid and the Supplemental Nutrition Assistance Program (SNAP), which helps more than 42 million families afford their groceries.
In fact, Trump is putting unelected and unaccountable billionaires—Elon Musk and Vivek Ramaswamy—in charge of the “Department of Government Efficiency” (DOGE) to decide the painful cuts we’ll have to face. And surprise, surprise: They’re almost exclusively targeting programs that help working people, veterans, students, families, and other non-billionaires.
If Trump and the GOP get their way, we know exactly what to expect: Income inequality will worsen, crucial government programs will be starved, and corporations and the ultra-wealthy will amass even more outsized power over our economy and democracy.
But we can learn something else from our experience in 2017. Democrats united in their opposition to Trump’s tax cuts for the wealthy, pushing Trump’s approval rating to the lowest point in his presidency and ousting supporters of his corporate tax cuts in the next year’s midterms.
Tax giveaways for the wealthy and corporations were deeply unpopular with voters in 2018—and that’s only intensified after this recent wave of corporate price gouging that has squeezed American families. Lawmakers must make it as difficult as possible to enact this next tax giveaway.
This year, we need to make sure every single member of Congress understands that supporting Trump’s tax plans means turning their backs on working Americans.
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In 2025, States Will Flip the Script on Taxes to Make the Wealthy Pay Their Fair Share
State-based advocates have spent years building coalitions of pro-revenue champions committed to working together to fund the programs communities need.
Jan 08, 2025
After every big election, there’s a spotlight on the candidates that came out on top: Who’s in and who’s out, talk about mandates, seat margins, and the First 100 days.
There’s plenty of policy previews about next year.
But one issue will have a starring role both in Washington, D.C. and in states across the country—taxes.
We know Republicans in Washington are writing a play to extend and even expand President-elect Donald Trump’s 2017 tax cuts. And nearly every state will have to adapt to additional fiscal pressures while also finding ways to pay for the things our families and communities need.
We know the vast majority of Americans want the rich to pay more, not less, in taxes—at both the state and federal level. It’s time for elected officials to give the people what they want after years of disappointing performances.
Past sessions foreshadow how anti-tax elected officials around the country will act on behalf of their donors: Each time Republicans have held a trifecta in Washington this century, they’ve demanded tax cuts for the rich. During Covid-19, 26 states cut taxes, often targeting top earners, which will cost $124 billion by 2028.
We’ve seen this show before and it stinks.
The plot is tired, unbelievable, and relegates voters to a bit part, when it’s our communities that should be the lead. How many times do we have to listen to the same trickle-down economic nonsense? It’s getting old.
Polling shows that voters would rather politicians play it straight and raise revenue from big business and the wealthy rather than feel the squeeze as tax cuts lead to budget cuts to the programs and services our kids and communities need most.
Flipping the script on tax cuts for the wealthy is a core reason the State Revenue Alliance was created. Voters feel the economy isn’t working for them and want corporations and billionaire CEOs to pay their fair share. Ultimately in 2025, it’s the people who’ve too often been shut out of policy debates who will fight for tax justice and change the trajectory of tax policy in this country.
Knowing that 2025 would see a confluence of tax fights at the state and federal level, state-based advocates have spent years building coalitions of pro-revenue champions committed to working together and will have the resources to fight for good schools, housing affordability, and accessible healthcare in legislatures around the country.
Together, we’ve made real, tangible, and, yes, sustainable progress in our collective efforts to win pro-revenue policies. In 2024 alone, state-based grassroots organizations, labor groups, policy shops, and legislators supported 35 tax justice bills in state capitols. Six of those bills passed and were signed into law. Those bills included wealth taxes; corporate tax reform; reinstatement or creation of capital gains taxes; repealing certain tax breaks, which too often allowed the wealthiest to shield their assets; and more.
In anticipation of this year, we are already tracking nearly 50 tax justice bills filed in state capitols. When legislative sessions open early next year, our allies will be ready, putting forth a compelling case for ensuring the wealthiest and big corporations pay their fair share at the state level so everyone has a fair shot to survive and thrive.
Rather than divide us, taxes will be an issue that unites community voices across the country in 2025. In addition to our focus on tax justice in states, we will join hundreds of national organizations to demand Congress forgo any additional tax cuts for the wealthy and advocate for new revenue.
An extension of the 2017 Tax Cuts and Jobs Act (TCJA) will further reward the wealthiest individuals and big corporations with myriad tax breaks and benefits. We know it will come at the expense of working and middle-class families, costing us an estimated $4.6 trillion over the next 10 years. Extending the TCJA also puts additional strains on states and localities to make up potential funding gaps, as they rely on federal dollars for everything from schools to healthcare, critical infrastructure, and more.
We know the vast majority of Americans want the rich to pay more, not less, in taxes—at both the state and federal level. It’s time for elected officials to give the people what they want after years of disappointing performances.
As storylines develop following the 2024 election, progressives should consider the action in the states around taxes—who pays what they owe, who benefits from them, and whether or not they raise the revenue to fully fund our futures—as the biggest and most unifying fight on the horizon.
If we are successful, 2025 will reveal a more just, equitable, and sustainable tax code that helps build the future our communities deserve.
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