Republicans say their tax legislation will be great for the middle class. So why is it so unpopular?
In pitching their tax plan to the country, Republicans say it would save the typical middle class American family between $1,200 and $1,400.
But that may not be enough to buy widespread support for this plan because not everybody gets that amount, and the House and Senate bills contain some unpopular provisions.
Dave Lewandowski, a resident of Grand Rapids, Mich., is married and has three children. He works for a company selling vitamins, water filters and other health-related products.
The family’s household income is about $90,000 and he estimates he’ll save $600 under the House plan and about $1,800 under the Senate version.
And he’d definitely be happy to get a tax cut.
“We’re receiving a bit of a benefit at a time where it really helps,” Lewandowski says. “We’re trying to pay down some debt. We’re looking forward to taking a vacation next year. This is a welcome benefit for me and my family.”
Still, when it comes to the design of the overall tax plan itself, he’s conflicted.
Lewandowski says he votes for Republicans more often than Democrats, so it’s not politics. But he says he’s not sure the balance is right with the GOP plan’s huge tax cut for corporations.
“Many people in the middle class will receive a benefit, but that benefit is going to be muted or small,” he says, “whereas the bulk of the benefit is going to be felt by corporations and the wealthy.”
According to numbers from Congress’s nonpartisan Joint Committee On Taxation, the wealthy and corporations do get a much bigger share of the benefits from the tax bills.
And Lewandowski doesn’t like something else about the Republican plans.
“It’s not equally applied across it,” he says. “And when you look at the fact that this is a federal, national tax reform, some people are going to be impacted a lot more than others. So I would rather it be more that all people are impacted in the same way.”
For example, the plans don’t allow people to deduct state and local income taxes — and that can make a big difference for people in higher-tax states like California, New York and New Jersey.
Ani McHugh, a high school English teacher in Delran, N.J., says the plan “essentially punishes taxpayers who are already paying more in taxes. I don’t see how that’s a fair approach or a reasonable approach.”
McHugh’s husband is a police officer in the town where they live and they have two children. After checking with their tax adviser, she estimates the couple would end up paying between $3,000 and $5,000 more under the plan.
“I don’t see how they can say this helps middle class people in New Jersey,” she says.
Something else bothers her about the legislation. As a teacher, McHugh buys books for her students and other school supplies. And under at least the House tax plan, she would no longer be allowed to write those off her taxes.
“It’s just hard for me to wrap my head around the fact that corporations are getting huge tax cuts and the wealthy tax breaks, and I’m a teacher and I’m spending my own money on things that will help me teach and things that will help my students learn and I can’t write that off,” she says.
McHugh says she’s also worried that after they graduate, her students couldn’t write off student loan interest — the House bill would repeal that deduction. That would make college more expensive. Many graduate students actually see a huge tax increase under the House version.
Meanwhile she says that among the middle class people she sees around New Jersey, “everybody seems to be struggling and working harder and a lot of people have second jobs. And so when corporations get a permanent tax break and the wealthy get tax breaks and we’re paying more, yeah, that’s frustrating. … It’s infuriating.”
Multiple polls show that most Americans do not want a tax cut for the rich. That may be the biggest reason this tax overhaul is so unpopular.