PHOTOS: We're Not Falling for the Tax Scam
Tax Scam 101
Hi! I’ve read a lot so you don’t have to! Here’s what you need to know (as of now, and as we all know this will probably change). Photos from the Tax Scam march in Los Angeles on Monday.)
This is basically a trickle down theory bill written by rich people who don’t care about the future welfare of the country and also clearly can’t do basic math. (Trickle down theory, for those who missed it, is based in the idea that when rich people and businesses have more money in their pockets, they hire more people and pay them better and then everyone spends more money and stimulates the economy. This theory has been proven to be entirely untrue, but politicians keep pretending it isn't.)
Sure, the GOP tax bill does incentivize job creation with immediate tax credits for building things like factories--but it doesn’t have anything about the environment or like hiring people not robots. And once again, it has been proven that these types of things don’t really work to fix the economy nor are they necessarily good. (I would be 100% for giving wild tax breaks to people developing clean energy, I don’t care if they get rich, let’s at least use the current capitalist system to our advantage until it crumbles, who is with me.)
But more importantly, the bill lowers taxes for the top brackets; there are huge tax cuts for the top income tiers, while taxes will actually increase on lower-income and middle-class folks. And! There are almost no change to loopholes that get those rich people getting richer out of paying the taxes they could be paying to make everything work out. (Like come on boys it’s an either/or situation.)
How are we paying for these tax cuts? While they vaguely try to claim that it will pay for itself, it doesn’t. (Like I said: Bad math, like three trillion dollars worth of bad math.) Instead, it’s going to be paid for in massive cuts to programs that save lives if Congress doesn’t take additional action.
This is all part of PAYGO, a budget rule that mandates tax cuts be met with so-called entitlement cuts. What that means is that when this tax bill drastically cuts the federal revenue, it will trigger major budget cuts to things like Medicare, Social Security benefits, and the Crime Victims Fund. (Defense budgets, however, will not be impacted.)
Make no mistake: This bill will make our national debt significantly worse, and it offers no solutions. All the while, it's going to be gutting our already-limited government programs.
Things like Medicare will not lose all of its funding tomorrow. However, PAYGO is set up to slowly cut funding to these infrastructures under the assumption that funds will return but it does not account for a tax break for the rich with no basis in math.
When this whole thing collapses in on itself, the support systems in place today won't be in place anymore. Not in the same way, and in some cases potentially not at all.
Lawmakers are also standardizing deductions in this bill, claiming that removing deductibles for corporations justifies their cuts. (In case you don’t know: deductions are all of the things the government has decided are necessary expenditures that shouldn’t be taxed, like supplies for your job that aren’t covered by your employer, charitable donations, medical payments, etc.)
The new bill will get rid of many things people can write-off as deductions, but allows for a much higher ‘standard’ deduction. A ‘standard deduction’ is basically a set percentage of your income that will include all those things you would have itemized.
As we all know, corporations are usually pretty good at keeping their taxable income low--and most analyses of the bill say that, yeah, corporations win big. That's where the rest of us come in.
The lowest income bracket ($0-$9k) will see a raise from 10% to 12% but with the new standard deduction shifting from $6k to $12k, they will likely be paying $0 in taxes if filed correctly and everything is explained.
The Breakdown: If you live in a blue state, you’re going to be paying more. If you're middle-class, you might save money now--but you'll owe a lot more by 2025, so try saving it. If you have high medical bills, you'll likely be paying higher taxes. And the super rich will save SO MUCH MONEY! (Thanks to a good/possibly shady accountant.)
The fight isn't over yet. Take action to stop the tax scam.