Guess who lost their tax cut? The working poor and their children.
At the very last minute, in the House Conference Committee, 11.9 million poor children lost $3.5 billion while the 200,000 households earning over $1 million per year got about $90 billion in tax cuts.
The tax bill just passed will increase the child tax credit from $600 to $1,000. As a result, middle- and upper-income families will get a check in July for $400 per child. But not poor working families. Because of this last-minute decision, 11.9 million poor children in working families with incomes from $10,500 to $26, 625 lost their $3.5 billion. Why? To keep the total tax-cut package to $350 billion.
Of course, there would have been other ways to save this $3.5 billion for the working poor. Reducing the capital gains/dividend tax cut (which goes mostly to the richest 15 percent) just a little less—by a mere 2.3 percent—would have preserved the $3.5 billion for the working poor. This tax cut goes overwhelmingly to the rich.
Don't be deceived by statements that "91 million tax payers will receive, on average, a tax cut of $1,126" (Treasury Department). The tiny group (one-fifth of a million) of people who make over $1 million a year get an average tax break of $93,500 from this bill. On the other hand, the average tax cut for households in the middle fifth of all households is a mere $217—and 53 percent of all households (73 million) get less than $100!
When he signed the bill, the President said that 12 million elderly tax filers would receive an average tax cut of $1,401. But the elderly rich get most of it: 63 percent of the elderly get less than $100.
Fortunately, there is a bit of good news. After widespread negative publicity, the Senate voted 94-2 to restore ...1
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