McCaskill: ‘I wanted to support real tax reform. This isn’t it—this is a bad deal for Missouri families.

Nonpartisan analysis: Tax plan cuts ‘taxes of wealthy and hikes taxes on families earning under $75,000’ – Proposal would deepen the national debt, & former Defense Secretaries say plan jeopardizes military funding

WASHINGTON – The U.S. Senate Finance Committee has advanced a partisan tax plan that, according to independent analysts, “cuts taxes of [the] wealthy and hikes taxes on families earning under $75,000 over a decade”—a proposal that U.S. Senator Claire McCaskill calls “a bad deal for Missouri families.”

The proposed tax plan, advanced by Republican leaders in Congress, would restrict promised tax relief for working families, undermine the current healthcare law (leading to higher premiums and fewer insured Americans), and, according to former U.S. Defense Secretaries, jeopardize U.S. military funding—all while dramatically deepening the national debt with a costly tax giveaway to the richest Americans.

McCaskill released the following statement after voting against the proposal:

“I wanted to support real tax reform. This isn’t it—this is a bad deal for Missouri families. Working people in Missouri deserve better than to get scraps, while corporations and wealthy business owners make out like bandits in a plan that explodes our deficit and compromises our military. But I’m still going to keep fighting for my state—and if Congressional leaders decide to toss out this proposal and start fresh with a genuinely bipartisan approach that delivers real tax relief to working people, cleans out the loopholes exploited by the rich and corporations, and lowers the corporate tax rate, I’ll be the first to sign up.”

The proposed tax plan would make tax cuts to large corporations permanent, while making the relatively smaller tax breaks for individuals and families temporary.

McCaskill offered several amendments to the proposed tax plan during the Finance Committee’s process, including:

  • An amendment to restore the deduction for individuals and families for property that is lost in a disaster, such as flooding or a fire, outside of a formal declared disaster area—a deduction that is eliminated for individuals in the proposed tax plan, but retained for corporations. The amendment was rejected by the Republican committee members.
  • An amendment to ensure that individuals have the same access to deductions as corporations (such as deductions for state and local taxes, and moving expenses), which is not currently the case in the proposed tax plan. That goal, which was the subject of several amendments, was rejected by the Republican committee members.
  • An amendment to ensure that the tax plan’s proposed deduction for “pass-through” income—a deduction for business owners who receive income passed through various business structures like an LLC—would only be available to small business owners earning less than $1 million, instead of also being available to millionaires and billionaires. Under the amendment, the revenue that would gone to millionaires and billionaires would have instead gone to small business tax relief. The amendment was rejected by the Republican committee members.

McCaskill also cosponsored or voted to support several amendments to the proposed tax plan, including amendments to: make the tax cuts for individuals and families permanent, expand the child tax credit, protect Social Security and Medicare from budget cuts, and establish a dedicated infrastructure fund with some of the revenue from companies shifting tax dollars back to the U.S. from overseas.

Republican members of the committee rejected each of those amendments, and every amendment offered by the committee’s Democrats.

As reported today, according the Joint Committee on Taxation—who serve as the official nonpartisan analysts for Congress—under the proposed tax plan: “Tax hikes for households earning $10,000 to $30,000 would start in 2021 and grow sharply from there. By the year 2027, Americans earning $30,000 to $75,000 a year would also be forced to pay more in taxes even though people earning over $100,000 continue to get substantial tax cuts. Most of the hit to the poor and working-class comes from the Senate Republicans' push to insert a major health care shift into the tax bill… [leading] to 13 million more uninsured, the Congressional Budget Office has said. Many of those people earn modest incomes and currently receive tax credits and subsidies from the government to help them afford insurance. As health insurance premiums rise and people opt not to buy insurance anymore, their tax breaks go away…”

The Congressional Budget Office has also predicted that the massive deficit increase resulting from the proposed tax plan would lead to automatic spending cuts to Medicare, agriculture subsidies, and student loans, to compensate for lost federal revenue.