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As ‘Super Bowl of taxes’ looms in 2025, progressives urge Congress to ensure fairness

18 September 2024 at 20:53
tax policy rally in Washington DC

Robert Codero, 49, of New York City, joined hundreds of advocates on Capitol Hill Wednesday, Sept. 18, 2024, to speak to lawmakers about tax policy ahead of next year’s expiration of the Trump-era tax law. Codero attended as part of the nonprofit Make the Road New York, which also has chapters in New Jersey, Nevada and Pennsylvania. (Photo by Ashley Murray/States Newsroom)

WASHINGTON — Dozens of progressive organizations from across the United States descended on the nation’s capital Wednesday to champion “tax justice” ahead of Congress’ major task of resetting the tax code in 2025.

Led by a coalition named Fair Share America, state and national advocates urged lawmakers to raise the corporate tax rate and ensure those who make over $400,000 annually “pay their fair share.”

Organizers from 20 states fanned out across Capitol Hill, meeting individually and speaking publicly with lawmakers, and testifying before senators.

Kristen Crowell, the coalition’s executive director, said the advocates traveled to Washington to “make sure our representatives know that we know exactly how this tax scam has played out at the local level in our communities.”

“We are getting organized, we are building a multi-racial, multi-sector organization that has real people power on the ground so they can’t cut deals behind closed doors without us holding them accountable,” Crowell said at a large press conference held by lawmakers and advocates outside the U.S. House that eventually thinned out due to rain.

Sen. Michael Bennet of Colorado told the crowd they are the “only antidote there is to the special interests that come to this Capitol.”

“This is the beginning of a long battle that we’re going to have for tax fairness in this country, and we’re really happy that you’re here,” said Bennet, a Democratic member of the Senate Committee on Finance.

Rep. Lloyd Doggett of Texas, a senior Democrat on the tax-writing House Committee on Ways and Means, co-led the press conference and told the crowd to get ready for the “Super Bowl of taxes.”

A group of 61 care-giving advocacy groups among the visiting organizations urged using tax revenue — raised by tax increases on the wealthy — to fund child care, and care for the elderly and those with disabilities.

One of its leaders, Ai-jen Poo, president of the National Domestic Workers Alliance, testified Wednesday afternoon before the Senate Committee on Banking, Housing and Urban Affairs Subcommittee on Economic Policy.

“By asking the wealthiest individuals and wealthy corporations to pay their fair share, lawmakers can leverage the tax code to support robust public investments such as guaranteed access to early education (including child care and pre-K), comprehensive paid family and medical leave, and robust aging and disability care, and good jobs for all care workers,” the Care Can’t Wait coalition wrote in a letter to congressional leadership ahead of the subcommittee hearing.

Harris, Trump tax promises

The advocates’ coordinated visit comes as Vice President Kamala Harris and former President Donald Trump make broad tax promises on the campaign trail ahead of November’s presidential election.

Prior to his Wednesday night rally on Long Island, New York, Trump declared on his social media platform Truth Social that he would lift a $10,000 cap on the state and local tax deduction, otherwise known as SALT. The deduction was part of Trump’s signature 2017 tax law, which is set to expire in 2025.

“WHAT THE HELL DO YOU HAVE TO LOSE? VOTE FOR TRUMP! I will turn it around, get SALT back, lower your Taxes, and so much more,” he posted Tuesday.

A full SALT deduction is more valuable for higher income taxpayers, and prior to the 2017 cap 91% of taxpayers who claimed it lived in California, New York, New Jersey, Illinois, Texas and Pennsylvania, according to an analysis by the Tax Foundation.

Pennsylvania is a key swing state in the presidential race, and several competitive U.S. House races in New York could help decide which party will gain control of the chamber.

Before this change to his platform, Trump had been running on fully extending his 2017 tax law beyond its 2025 expiration date, with the addition of permanently lowering the corporate tax rate even further to 15%.

Analyses from several economists estimate a wholesale extension would add anywhere from $2 trillion to roughly $6 trillion to the national deficit over the next decade.

Trump has also promised to get rid of taxes on tips, Social Security benefits and overtime.

When asked about the effects of Trump’s tax proposals on the nation’s deficit, Republican Sen. John Thune of South Dakota, who is eyeing the position of Senate majority leader if the GOP takes control, told reporters Wednesday, “We’re starting to have some of those conversations already, what impact do some of those changes have? And what does, you know, what are the trade-offs that would happen as a result?”

Harris’ “opportunity economy” platform includes plans to make permanent a pandemic-era expansion of the child tax credit and attach an additional $6,000 credit for new parents. Like President Joe Biden’s budget proposal, Harris also vows to not raise taxes on anyone earning under $400,000 a year.

When speaking to the National Association of Black Journalists Tuesday, Harris revived an earlier Biden administration promise to cap child care costs at 7% of a household’s income.

“If you think about the benefit to the economy overall, it strengthens our economy to do things like pay attention to affordable child care, affordable home health care and extending the child tax credit,” Harris told the association at a discussion in Philadelphia.

The National Women’s Law Center Action Fund, one of the interest groups on Capitol Hill Wednesday, said Harris’ plan would be “transformative” for families.

Harris also promises to increase the corporate tax rate to 28% from the current 21%; tax long-term capital gains at 28%; give a $25,000 tax credit to first-time home buyers; and give new small businesses a $50,000 deduction for start-up costs. She has also embraced the promise to end taxation on tips.

Organizers on Capitol Hill Wednesday represented groups from Arizona, Colorado, Connecticut, Iowa, Maine, Maryland, Michigan, Minnesota, Montana, Nebraska, New Hampshire, Nevada, New Jersey, New York, Pennsylvania, Vermont, Virginia, West Virginia, Washington, and Wisconsin.

Jennifer Shutt contributed to this report.

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