While the recent tax cuts were billed as relief to the middle class, ample evidence has shown that the benefits flowed almost exclusively to those at the very top. A new ITEP analysis of the cuts, alongside previous tax cuts by Presidents Bush and Obama, highlights the extent to which the federal tax code is shifting more and more to benefit the wealthiest in our country at the expense of working people: Since 2000, more tax cuts have gone to the top 1% than to the bottom 60% of Americans.
This highlights the importance of fixing the tax code and making it fairer. As economic inequality grows and prices continue to rise faster than wages, the need becomes even more urgent to build an economy that works for most Americans — instead of an elite few who have rigged the system to keep the lion’s share of rewards for themselves.
Simply put, to end poverty and rebuild the middle class, we need to put more money in the pockets of hard-working Americans. New data explored here show the political appeal of this idea.
A Working Families Tax Credit is immensely popular among 2020 Democratic primary voters: 74% support (52% strong support), 14% opposed.
THE WORKING FAMILIES TAX CREDIT
The Working Families Tax Credit, established by modernizing and expanding the state Earned Income Tax Credit (EITC), is a powerful and practical plan to provide relief to the tens of millions of Americans who are struggling in poverty or live one bad break away from the financial brink.
On the merits, there is no simpler or better-tested policy to provide economic stability to working and middle-class people. The existing EITC already lifts more families out of poverty than food stamps, housing subsidies, and unemployment insurance combined, because cash gives people the tools to solve their own problems.
The Working Families Tax Credit will help working people face the rising cost of living and housing, with a leg up out of poverty or a cushion of financial stability.
The Working Families Tax Credit is a simple and effective policy to provide meaningful economic relief to Americans today. It will:
- Help working people face the rising cost of living and housing, with a leg up out of poverty or a cushion of financial stability.
- Fight rising inequality that threatens our democracy.
- Make taxes fairer, so the wealthiest pay their fair share.
- Build on a high minimum wage, so workers earn enough to live.
Much more ambitious than a typical, incremental expansion of the EITC, this proposal pushes up the income ceiling to cover not only those in poverty but those living on the brink in the lower middle-class. It offers a much more generous credit than the traditional EITC, from which many recipients receive only a modest benefit.
Importantly, it expands the definition of work to include those who are giving back to society in other ways, even if they have zero income — family caregivers and full-time students. And it creates an option to receive the credit monthly, to keep people from falling into debt as the year goes on: a regular drumbeat of financial stability in people’s checking accounts. It is paid for by raising taxes only on income above $250,000.
Read more details about the policy at www.WorkingFamiliesTaxCredit.org.
A POPULAR PROGRESSIVE IDEA FOR 2020
A new poll looks at the popularity of a Working Families Tax Credit among likely 2020 Democratic primary voters. The idea of a tax break for working and middle class families funded by a tax increase on the wealthiest is immensely popular: 74% support (a striking 52% expressing strong support), with only 14% opposed.
Support remains very high after pro and con arguments (65% support, 15% opposed), and 63% of primary voters are more likely to support a candidate who backs this policy.
Previous polling shows that the idea is popular across the board, winning 69% support in national polling, with majority support from voters of all political parties. Less likely voters, who would be important turnout targets in 2018 and 2020, are nine points more enthusiastic than definite voters, giving them another reason to turn out on Election Day.
It has been reported that the Trump administration will push another round of tax cuts, perhaps as soon as this fall, seeking to make permanent the individual tax cuts that disproportionately benefit the wealthiest. Perhaps members of Congress looking to oppose those additional cuts and to reverse the previous tax cuts on the wealthy should make the case against cuts that offer an outsized benefit to those already thriving, and then pivot to a message that talks about real tax breaks for working and middle-class families through a Working Families Tax Credit.
The popularity of the Working Families Tax Credit creates a potential opportunity for 2020 as a bold new idea that excites voters seeking a progressive economic vision, alongside ideas like Fight for $15, debt-free college, and Medicare for All. The Working Families Tax Credit is an idea that should be considered as part of a comprehensive package of economic policies that will draw enthusiasm at the polling booth and relief for the pocketbooks of millions of Americans.