The chairman of the Senate Finance Committee, Orrin G. Hatch (R-Utah) and Senator Sherrod Brown (D-Ohio) had a tense exchange during the Senate Finance Committee's review of the bill of the Senate. GOP on November 16 (Senate Finance Committee)
The Senate Republican tax plan gives important tax and benefit cuts to Americans who earn more than $ 100,000 a year, while the poorest in the country would be in worse shape situation, according to a report published on Sunday by the Budget Office of the non-partisan Congress. 19659003] Republicans intend to get the full Senate to vote on the fiscal plan as early as this week, but the new CBO badysis that shows great detrimental effects for the poor can complicate those plans. CBO also said the bill would add $ 1.4 trillion to the deficit in the next decade, a potential problem for Republican lawmakers concerned about the growing US debt.
Democrats have repeatedly criticized the bill as a gift to the rich at the expense of the poor. In addition to reducing taxes for businesses and many people, the Senate bill also makes a major change to health insurance that CBO projects would have a severe impact on low-income families.
In 2019, Americans who earn less than $ 30,000 a year are worse off under the Senate bill, found CBO. By 2021, Americans earning $ 40,000 or less would be net losers, and by 2027, most people earning less than $ 75,000 a year would be in worse shape. On the other hand, millionaires and those who earn between $ 100,000 and $ 500,000 would be large beneficiaries, according to CBO calculations. (In the CBO table below, negative signs mean that people at those income levels pay less taxes and are better off).
Source: Report of the Congressional Budget Office on November 26, 2017.
The main reason why the poor The Republican Senate Bill eliminates the requirement that almost all Americans acquire health insurance or pay a fine. CBO has calculated that health insurance premiums would increase if this bill were to become law, which would lead to 4 million Americans losing their health insurance by 2019 and 13 million losing insurance by 2027.
Many of people who are likely to leave health insurance have low or moderate incomes. If they give up health insurance, they no longer receive some tax credits and subsidies from the government. The Joint Tax Committee (JCT), the other non-partisan official group that badyzes tax bills, published a similar report that shows how low-income families are harmed by the loss of tax credits for care medical But CBO goes a step beyond JCT. CBO also calculates what would happen to Medicaid, Medicare and the Basic Health Program if the GOP Senate plan became law. The CBO is showing even worse impacts on poor families than JCT.
Republicans, including the chairman of the Senate Finance Committee, Orrin G. Hatch (R-Utah), have argued that their bill helps Americans across the income spectrum. They say that JCT and CBO badyzes are deceptive because buying health insurance is an option. If an individual or a family no longer wants to do it, that is their decision. They also argue that low-income families are not losing money in their portfolios.
The badysis of CBO and JCT makes it seem that a family is really taking money from them, but in reality, most of these families make $ 30,000 and do not pay any income taxes. The credits and subsidies they received to help them buy health insurance were usually sent directly from the government to the insurance company. So, it is unlikely that these families will see changes in their tax bills.
But Democrats and advocates for the poor say these low-income Americans will be worse off if they no longer have health insurance.
Asked by Senate Republicans JCT, calculate what happens to families across the income spectrum if only the tax impacts of the Senate bill are taken into account (therefore, baduming that the revocation of the individual mandate does not have impacts). JCT sent the following table to the Republicans of the Senate. It shows that all income groups, including people earning less than $ 30,000, receive a tax cut.
But that changes in 2027 because the Republican Senate bill currently allows individual tax cuts to expire in 2026. In 2027, people earning less than $ 75,000 would end up paying more, according to JCT. Republicans say that Congress will likely expand those cuts, but that counts on future lawmakers to act.