Rep. Chu Statement on Tax Scam 2.0
Washington, DC — This week, the House passed a package of bills – H.R. 6756, the American Innovation Act of 2018, H.R. 6757, the Family Savings Act of 2018, and H.R. 6760, the Protecting Family and Small Business Tax Cuts Act of 2018 - as a follow-up to H.R. 1, the Republican tax bill signed into law at the end of last year. This package – referred to as Tax Scam 2.0 - would make the GOP tax law’s temporary provisions for individuals permanent. They currently expire after 2025. Provisions for businesses organized as pass-throughs, which pay taxes through the individual system, would also be made permanent.
Other provisions include making permanent the doubled estate tax exemption to $22 million per couple, the $10,000 cap on the deduction for state and local taxes (SALT), the cap on mortgage interest deduction, and the limits on the casualty loss deduction. The Tax Policy Center estimate that these bills will add over $3 trillion to the debt in its first ten years of implementation. Rep. Judy Chu (CA-27) voted against the bills and released the following statement:
“This is another handout to the wealthiest Americans while leaving the middle class to pick up the tab. Already, the first Tax Scam has failed to deliver on the promise of higher wages. In fact, while corporations and shareholders are getting richer, only 4.4% of Fortune 500 workers have seen a raise or bonus. This Tax Scam 2.0 will build on that failed record by giving the top 0.1% of Americans with average incomes over $4 million per year an average tax cut of $105,000 in its first year alone. That $105,000 tax cut exclusively for the 120,000 wealthiest Americans would be larger than the entire annual income for more than 120 million individual American households – before taxes – in that same year.
“This bill also makes the $10,000 cap on the State and Local Tax deduction permanent, meaning my constituents in California will be double taxed and paying more to finance these cuts for others. In fact, in my home district, 37% of tax filers claimed the SALT deduction in 2016, and the average SALT deduction was $18,517. This is nearly DOUBLE the cap that Republicans have put in place.
“Additionally, just hours before the vote and after most people had gone home, Republicans inserted dangerous anti-choice language into the Family Savings Act by allowing parents to open 529 college savings accounts for unborn children. This is unnecessary. Under current law, a parent can already open a 529 under their own name and transfer it to their child once it’s born. The real purpose of this language is to undermine Roe v. Wade and lay the legal groundwork to undermine a woman’s constitutional right to an abortion.
“Instead of using this opportunity to help working families who are struggling with rising costs of education and healthcare, the Republicans used this bill to enrich their donors and wage a politically motivated war on women.”