General Analysis of the GOP Tax Plan from Americans for Tax Fairness · 13 Terrible Things about the Republican Tax Plan
- Tax Cuts for New York’s Richest 1%
- The richest 1% will get 42% of the entire tax cut by the tenth year.
- Their tax cut will be $34,130 a year, on average.
- There are 96,500 New York taxpayers in the richest 1%.
They earn at least $1,142,360 and this group’s average income is $4,425,000. [Sources: Institute on Taxation and Economic Policy (ITEP) and ITEP taxpayers in top 1%]
Tax Increases on New York’s Middle Class
- 24% of New York households would see their taxes increase in 2027 by $3,510 on average.
- 19% of households making between $32,490 and $56,290 would see their taxes increase by $610 on average.
- 25% of households making between $56,290 and $91,120 would see their taxes increase by $1,280 on average.
- 34% of households making between $91,120 and $161,000 would see their taxes increase by $2,220 on average. [Sources: Institute on Taxation and Economic Policy]
Harmful Effects in New York from Partially Repealing the State and Local Tax Deduction · In New York, 35% of all taxpayers claim the SALT deduction, which averages $22,200. [Source: Tax Policy Center] In New York’s 24th Congressional District, 29% of taxpayers claim a SALT deduction of $12,100 on average. [Source: Government Finance Officers Association]
- Under the GOP tax plan, a middle-class couple with two children owning a home in New York’s 24th Congressional District could face a tax increase of up to $1,600 next year—due to the partial repeal of SALT. [Source: Americans Against Double Taxation]
- The GOP tax plan makes major changes to the state and local tax deduction (SALT). It would repeal the deduction for state and local income and sales taxes while preserving the deduction for property taxes up to $10,000. Even with the “compromise” to partially preserve the property tax deduction, the tax plan would cut the total amount of state and local tax deductions by 88%. This move, in combination with other elements of the GOP tax plan, would raise taxes on the middle class and undermine state and local public services. [Source: Institute on Taxation and Economic Policy]
- Currently, taxpayers can deduct state and local property taxes, and either income or sales taxes, from their federal taxable income. Over a third of taxpayers making $50-75,000 use the SALT deduction, and over half of those making $75-100,000. In addition to boosting taxes on many middle-class families, repeal of the deduction for income and sales taxes will make state and local taxation more expensive, putting pressure on states and localities to cut budgets for services like roads and schools. [Source: Government Finance Officers Assoc.]
Effect of Estate Tax Repeal on New York
- In New York, only about 470 estates will be subject to the estate tax in 2018. Repealing the estate tax would cost about $2.3 billion in New York, which is enough to pay for nutrition assistance for 1,401,848 people. [Sources: CBPP and Center for American Progress]
- The House GOP tax plan weakens then eliminates estate and gift taxes, losing $152 billion over 10 years and boosting the inheritances of the very wealthy. The federal estate tax is paid only by estates worth at least $5.5 million, just 2 out of 1,000 estates, or only 5,500 estates in all of 2017. [Sources: Joint Committee on Taxation, Center on Budget and Policy Priorities (CBPP) and Tax Policy Center]
Programs at Risk Due to Tax Cuts To pay for their massive tax cuts to the wealthy and corporations, House Republicans have proposed huge cuts to services that working families rely on. The budget resolution approved by Congress would cut:
- $1.3 trillion from Medicaid and other health care programs over 10 years · $470 billion from Medicare over 10 years
- $650 billion from income security programs, which may include cuts to the Supplemental Nutrition Assistance Program (SNAP, or food stamps), Supplemental Security Income (SSI) for disabled individuals, and tax credits for working families.
- Also at risk are Pell Grants and other financial aid to help students afford college. [Source: CBPP]
In New York’s 24th Congressional District:
14% of adults and 33% of children are covered through Medicaid and the Children’s Health Insurance Program. [Source: Georgetown University Health Policy Institute] ·
139,800 people are covered through Medicare fee-for-service and Medicare Advantage plans. [Centers for Medicare & Medicaid Services] ·
39,400 households rely on SNAP for nutrition assistance. [Source: U.S. Department of Agriculture]
16,300 college students benefit from Pell Grants [Source: National Association of Independent Colleges and Universities]