There are a few results of this plan that need more scrutiny.
An update: The final version of this bill kept the medical expense deduction and even improved it. Also, working-class families get a bigger child tax credit: Thanks to a late push by Rubio and Sen. Mike Lee (R-Utah) — and probably partly because of Jimmy Kimmel — the child tax credit would be more generous for low-income families and the working class.
There are two competing tax bills that will form the basis of an attempt at compromise over the coming weeks, one from the House of Representatives and one from the Senate, answer the question differently. The Senate bill would keep a deduction for medical expenses intact. The House bill would kill it off entirely. The more money that people had to spend this year, the more they would lose next year if the House prevails and the deduction disappears.
The AARP Public Policy Institute, relying on the latest Internal Revenue Service data from 2015, notes that 8.8 million people take the medical expense deduction each year and over 50% of these are seniors. This not surprising, as seniors are going to have most of the medical problems. The House version would disallow this, costing seniors thousands of dollars every year, which is money they need for, you know, food, for example.
But won’t these tax breaks “trickle down” to us, sparking the economy and providing new jobs? There were several surveys done on this; only 8% of the executives surveyed said the bill would make them increase hiring plans “significantly.” Only 11% said they would significantly increase their capital investment plans. A solid majority answered either “no change” or “increase somewhat.” What they’ll really use this for is debt reduction and executive bonuses, because, you know, their peeps need renovations on their summer homes.
The other impact is this: Once it becomes clear that this bill is going to cause a massive spike to the deficit, guess where our
Party of the People Republican representatives are already talking about to reduce the load: Cuts to Social Security and Medicare. Because giving money to folks who won’t miss a meal or a prescription is the right thing to do.
And we already know that, as the years go by, any tax breaks that the middle class gets disappear within a decade, while the rich continue to reap the benefits.
This bill is heinous on so many levels that I cannot fully grasp how it is going to go through. But it looks like it will, despite the campaign promises of no cuts to Social Security or Medicare by our President. So much for promises; once he got what he wanted, he shows he really cares not for what we need.