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trump tax cuts
Top Dem Says Trump 'External Revenue Service' Can't Hide Plans for Huge Tax Gift to the Rich
"No amount of silly rebranding will hide the fact that Trump is planning a multitrillion-dollar tax hike on American families and small businesses to pay for another round of tax handouts to the rich," said Sen. Ron Wyden.
Jan 14, 2025
The top Democrat on the Senate Finance Committee said Tuesday that President-elect Donald Trump's proposed creation of an "External Revenue Service" to collect tariff proceeds can't conceal his plans for a massive tax giveaway to the wealthy and large corporations.
"No amount of silly rebranding will hide the fact that Trump is planning a multitrillion-dollar tax hike on American families and small businesses to pay for another round of tax handouts to the rich," Sen. Ron Wyden (D-Ore.) said in a brief statement after Trump announced his proposal in a social media post.
The president-elect wrote that on the first day of his new term, he intends to create "the EXTERNAL REVENUE SERVICE to collect our Tariffs, Duties, and all Revenue that come from Foreign sources."
"We will begin charging those that make money off of us with Trade, and they will start paying, FINALLY, their fair share," Trump added. "January 20, 2025, will be the birth date of the External Revenue Service."
Only Congress can establish new executive branch agencies, so it's unclear how Trump's proposed External Revenue Service would be established. Currently, U.S. Customs and Border Protection collects tariff revenue.
Outside advisers to Trump anonymously toldThe Washington Post that the president-elect's plan "could involve renaming an existing office within the Treasury Department."
Trump and Republican lawmakers have pointed to tariff revenue—along with deep cuts to Medicaid, federal nutrition assistance, and other key programs—as a potential way to help offset the huge projected cost of their proposed extension of the 2017 tax cuts, parts of which are set to expire at the end of the year.
But the Institute on Taxation and Economic Policy (ITEP) noted in an analysis conducted shortly before the November election that the sweeping tariffs Trump has floated "would largely be passed onto consumers as increased prices." Those price increases "would more than offset" Trump's proposed tax cuts "for all income groups outside the richest 5%."
"If these proposals were in effect in 2026, the richest 1% would receive an average tax cut of about $36,300 and the next richest 4% would receive an average tax cut of about $7,200," ITEP found. "All other groups would see a tax increase, with the hike on the middle 20% at about $1,500 and the increase on the lowest-income 20% of Americans at about $800."
Trump's call for the creation of an "External Revenue Service" comes days after CNNreported that the president-elect is "considering declaring a national economic emergency to provide legal justification for a large swath of universal tariffs on allies and adversaries."
"The declaration would allow Trump to construct a new tariff program by using the International Economic Emergency Powers Act, known as 'IEEPA,' which unilaterally authorizes a president to manage imports during a national emergency," the outlet continued, citing unnamed sources. "Trump, one of the sources noted, has a fondness for the law, since it grants wide-ranging jurisdiction over how tariffs are implemented without strict requirements to prove the tariffs are needed on national security grounds."
The emergency declaration could come as soon as Inauguration Day, according toAxios.
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Trump Allies Launch $20 Million Effort to Convince Working Class to Back Tax Scam 2.0
"Don't be fooled: What this Koch-backed group is really only after is protecting tax cuts for wealthy people like me," said the chair of the Patriotic Millionaires.
Jan 13, 2025
A right-wing advocacy group founded by the billionaire Koch brothers announced Monday the launch of a $20 million campaign to promote an extension of the 2017 Trump-GOP tax cuts, which disproportionately benefited the rich and large corporations.
But in a 60-second ad that debuted over the weekend, Americans for Prosperity (AFP) characterizes the 2017 Tax Cuts and Jobs Act as a boon to "hardworking Americans" and small businesses—and warns that allowing provisions of the law to expire at the end of this year as scheduled would be disastrous for the working class.
"This year, Congress is facing a countdown to a crisis that threatens family budgets nationwide," Ross Connolly, AFP's regional state director, said in a statement Monday. "We are proud to partner with the incoming Trump administration to protect prosperity and ensure that Congress acts."
AFP is a 501(c)(4) organization that describes itself as a "grassroots" movement despite being launched by Charles Koch and his late brother, David—two of the most notorious right-wing billionaire in U.S. politics.
The group said its new 50-state campaign represents "the largest effort by a conservative organization" to support President-elect Donald Trump's legislative agenda as he prepares to take office next week. The campaign, according to AFP, will include "over 1,000 meetings" at congressional offices, "in-district events" with activists and lawmakers, and "roundtables with job creators."
The campaign aims to "reach millions of voters on the phone and at their doorsteps," AFP said.
"The Trump tax giveaways passed in 2017 did not help working-class Americans. In fact, the top 1% of corporations received almost all of the benefits."
AFP's description of the impacts of the 2017 tax law flies in the face of resounding evidence showing that wealthy Americans—not ordinary workers—were the chief beneficiaries and are poised to reap most of the rewards once again if Trump and the Republican-controlled Congress extend the measure's soon-to-expire provisions.
"Americans for Prosperity is spending $20 million on a new ad campaign that champions the 2017 Trump tax law as a win for working families," Morris Pearl, chair of the Patriotic Millionaires, told Common Dreams. "But don't be fooled: What this Koch-backed group is really only after is protecting tax cuts for wealthy people like me."
"I'm in favor of tax relief for working people, but not yet another huge and unnecessary windfall for America's rich," Pearl added. "If Congress wants to help working families, they should make tax rates on labor income the same as tax rates on profits made by investors."
AFP is one of a number of right-wing, corporate-tied organizations pushing for an extension of the Trump tax cuts, which Republicans are planning to fund by slashing Medicaid, federal nutrition assistance, and other key programs.
The progressive watchdog group Accountable.US noted in a recent analysis that one of the groups pushing for an extension of the 2017 law is Advancing American Freedom, an organization "run by corporate consultants, lobbyists, lawyers, and executives, including former Trump administration officials who were directly responsible for the TCJA."
Accountable also observes that Club for Growth, a group funded by wealthy conservatives, "has pushed a deeper corporate tax cut plan as an 'opening salvo' in the current tax debate."
"The billionaire funders of the group's action arm have benefited enormously from the TCJA, saving hundreds of millions of dollars from a single obscure tax break for pass-through entities," the watchdog added.
In response to AFP's new nationwide campaign, Accountable.US executive director Tony Carrk told Common Dreams that "a glitzy ad campaign from a far-right organization won't change the fact that the Trump administration and Republican-controlled Congress are paying for giveaways to billionaires, wealthy tax cheats, and price-gouging corporations by cutting critical services for working families, like Medicaid and SNAP."
"The Trump tax giveaways passed in 2017 did not help working-class Americans," said Carrk. "In fact, the top 1% of corporations received almost all of the benefits."
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Will Trump Tax Cuts for the Rich Blow a Hole in the 'Rock-Solid Labor Market' Left by Biden?
"If he pursues trillions in tax cuts for the wealthy and implements the proposals to slash public investments that people like Musk have championed, the labor market will surely deteriorate and workers will suffer."
Dec 06, 2024
Job figures released Friday showed that the U.S. labor market rebounded strongly last month following a storm-ravaged October, with the economy adding 227,000 jobs and average hourly earnings rising by a higher-than-expected 0.4%.
But observers warned that the economic agenda of President-elect Donald Trump and the incoming Republican Congress—particularly the massive tax cut package they plan to ram through early next year—could undermine job market progress made under the Biden administration in the aftermath of the Covid-19 crisis.
"The Biden administration is handing off a rock-solid labor market after their strategic investments strengthened our economy and ushered in the fastest recession recovery on record," said Lindsay Owens, executive director of the Groundwork Collaborative. "President-elect Trump would do well to continue to invest in the workers and communities that have powered this resilience."
"But if he pursues trillions in tax cuts for the wealthy and implements the proposals to slash public investments that people like [Elon] Musk have championed," Owens added, "the labor market will surely deteriorate and workers will suffer the consequences of these choices."
Rep. Brendan Boyle (D-Pa.), the top Democrat on the House Budget Committee, similarly warned Friday that "while Democrats delivered a historic recovery with millions of new jobs under President Biden, Donald Trump and his far-right allies want to take us backward."
"Trump's promises are nothing but a con," said Boyle. "He's pushing middle-class tax hikes while handing massive breaks to his billionaire donors, just like he's done before. Families like mine know the truth: Trump would sell out millions of workers in a heartbeat to line the pockets of the ultra-wealthy. House Democrats won't stand by while Trump sabotages our economy. We'll fight to protect the progress we've made and ensure working families continue to come first."
"Don't let them fool you. His plan of vengeance to deport millions of undocumented workers and impose tariffs will not create jobs."
The U.S. economy has added an average of 173,000 jobs monthly over the past three months, Economic Policy Institute senior economist Elise Gould noted in an analysis of the new Labor Department figures.
"Nominal wage growth held steady at 4.0% over the year," Gould observed. "This rate is in line with the pace of productivity improvement over the last year and a stubborn low labor share of corporate sector income. Importantly, it means that real average wages continue to rise as they have the last 18 months."
The new data came as congressional Republicans and Trump's billionaire-dominated transition team and Cabinet choices continued to map out their agenda for the coming year, with tax cuts at the center.
"Their top objective is to extend the 2017 Trump tax law and prevent $3.3 trillion in tax breaks from expiring at the end of 2025," NBC Newsreported earlier this week, detailing GOP plans to pass a "huge party-line bill" via the filibuster-proof reconciliation process.
A Congressional Budget Office analysis published Wednesday detailed how an extension of soon-to-expire provisions of the 2017 tax law—a measure that disproportionately benefited the rich—would shrink the U.S. economy, bolstering concerns about the potentially damaging impacts of the Trump-GOP agenda.
Prior to the November election, the research firm Moody's Analytics warned that a Republican sweep would likely mean "the economy suffers a recession beginning in mid-2025," resulting in 3.2 million fewer jobs and a higher unemployment rate by the end of Trump's four-year term.
Moody's argued that Trump's push for tariffs, corporate tax cuts, and the mass deportation of undocumented immigrants would broadly harm the economy, driving up inflation and pushing down Gross Domestic Product (GDP) and job growth.
While corporations would likely "navigate things reasonably well" under a Republican-dominated government, Moody's said, ordinary households would "do less well financially."
"The typical American household's real after-tax income is approximately $2,000, or 1.4%, lower by the end of Trump’s term in this scenario than in the baseline," the firm projected.
Sen. Martin Heinrich (D-N.M.), chairman of the Joint Economic Committee, said in a statement Friday that Trump "was the first president since World War II to leave office with fewer jobs than when his administration started."
"And his disastrous policies will hurt our economy once again," said Heinrich. "Don't let them fool you. His plan of vengeance to deport millions of undocumented workers and impose tariffs will not create jobs. It will not support our manufacturers, farmers, or small businesses. And it certainly will not grow our economy. It will only create an unmitigated disaster for everyday Americans who will struggle to make ends meet."
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