The official tax scorekeepers in Congress have concluded that at every income level, some people will have to pay higher taxes under a sweeping tax overhaul described by President Trump and House Republicans as a massive cut for the middle class.
The analysis by the Joint Committee on Taxation also shows that because some benefits in what has been dubbed the "Tax Cuts and Jobs Act" expire after five years, the percentage of losers increases over time.
For those making $75,000 to $100,000 for example, about 11% will pay at least $100 more in taxes in 2019 than they would have paid under current law. That figure grows to 30% in 2025, including 21% who will be paying an additional $500 or more.
For those making $50,000 to $75,000, the percentage who would pay at least $100 more grows from 10% in 2019 to 27% in 2025, including 16% at that point who would pay an additional $500 or more.
The figures come as the Republican majority in Congress is racing to finish a tax bill before Christmas.
The House Ways and Means Committee held its second daylong hearing Tuesday, on its way to passing the bill by Thursday. Early Tuesday, the committee voted along party lines to defeat Democratic changes that would maintain the existing deduction for state and local taxes and repeal the tax changes in two years if projected economic growth does not materialize and the deficit balloons.
While the House seems to be seeking passage with only Republican votes, Democrats from swing states were being wooed in the Senate on Tuesday.
“Members of both parties will have ample opportunity to offer amendments and that’s as it should be," Sen. Susan Collins, R-Maine, said at an event where she and Sen. Joe Manchin, D-W.V., agreed to be Senate leaders of a bipartisan “No Labels” group. "In the end, I’m hopeful that we will produce the kind of bipartisan tax relief that America needs and is looking for.”
Trump, who is traveling in Asia, called in to a meeting with Democratic senators were having with Marc Short, the White House director of legislative affairs, and Gary Cohn, the president's top economic adviser.
Sen. Sherrod Brown, D-Ohio, said he pushed two of his proposals, one of which would expand the Earned Income Tax Credit and Child Tax Credit to help working families avoid being pushed into poverty by taxes, and the other which would reward businesses that pay workers well.
“The president said he liked it. We said if things like this are in the bill … it will be bipartisan, we can get 70 or 80 votes,” Brown said. “So the president heard that, and I take him at his word that he likes it and we move forward. But if they put this bill out Friday and then try to jam it through … it’s not real legislation, it’s not real bipartisanship.”
Another attendee made a similar argument before the meeting.
“The thing I’m most worried about now on taxes is that we are being told that we maybe get to see the Senate bill on Thursday, maybe Friday, (and) that we’re expected to immediately be able to file amendments for the committee work next week,” said Sen. Claire McCaskill, D-Mo. “That seems beyond unreasonable to me. … I mean either they want a bipartisan deal or they don’t.”
Two provisions in the House tax bill are due to expire after five years: a new $300 credit for each taxpayer and spouse, and a provision that allows businesses to write off the full cost of equipment purchases immediately, rather than parcelling those costs out over several years.
Democrats at the Ways and Means hearing challenged Republicans to say whether those expiration dates were really just gimmicks to make the cost of the bill seem lower, and whether they really expect to renew the provisions before they expire.
"Either it’s the greatest bait-and-switch going on right now, or your intent is to continue the expiring provisions and keep piling on the debt," said Rep. Ron Kind, D-Wis.
The Joint Committee on Taxation is the official scorekeeper used by both parties to determine how proposed legislation would affect federal revenues.
A less detailed report issued by the joint committee over the weekend was used by Republicans at this week's hearings to argue that taxes would go down at every income level.
"Taxpayers at every (income group) will pay less under this plan, even considering the fact that the state and local deduction goes away," said Rep. Tom Rice, R-S.C.
But while those averages do show savings, the new details show that within each income group there are winners and losers.
The tax plan eliminates or caps many credits, deductions and exemptions, and replaces them with new credits and deductions that may not make up for what every taxpayer is using now.
For example, states where taxpayers itemize deductions could be hurt more than those where most people take the standard deduction. That's because the bill eliminates the deduction for such things as state income taxes and major medical expenses, and lowers the cap on the mortgage interest deduction.
For all taxpayers, the analysis shows 44% getting a tax cut of more than $500 in 2019. That figure that drops to 25% of taxpayers in 2025. Nearly 31% of taxpayers would see little change in their taxes in 2019, with payments either rising or dropping by less than $100. That group grows to 38% in 2025.
The data also show that in 2019, tax breaks of more than $500 will go to 48% of those making $40,000-$50,000, 65% of those making $50,000-$75,000, and at least 75% of those making from $75,000 or more.
The Joint Committee numbers are similar to a report issued Monday by the non-partisan Tax Policy Center, which concluded as many as 28% of taxpayers could end up paying more even as people in every income group saved money. The center later retracted the report, saying it made an error in calculations about a new child tax credit. It promised revised numbers once corrections were made.
Contributing: Eliza Collins, Deirdre Shesgreen