Economy & Business

Most Americans Believe False Claims about the Tax Bill

House Speaker Paul Ryan speaks at a press conference on Capitol Hill, December 19, 2017. (Reuters photo: Aaron P. Bernstein)
Bad arguments are winning.

After the GOP’s tax proposal was finalized, a familiar cry rang out: The bill will raise taxes on all but the richest . . . in 2027. Which just happens to be after the tax cuts are set to expire, a gimmick designed to make the bill comply with congressional budget rules.

Such allegations of tax-hiking now fill our headlines, with the crucial caveat buried somewhere in the text:

CNN Money: “One-Third of Middle Class Families Could End Up Paying More Under the GOP Tax Plan

New York Times: “Paul Ryan’s Middle-Class Tax Hike

Washington Post: “Senate tax bill would cut taxes of wealthy and increase taxes on families earning less than $75,000 by 2027

Newsweek: “Tax Reform: In the Long Run the Middle Class Will Be Taxed More

The predictable result is that a false claim — Republicans are raising taxes on all but the very rich, full stop — has spread like wildfire across Twitter, and has been given added momentum by think tanks, verified accounts, and trending hashtags.

This effort has certainly paid off. According to a recent New York Times poll, only a third of Americans believe that they will see their taxes go down in 2018. It should come as no surprise, then, that the bill’s extreme unpopularity is in line with historic tax rises, rather than tax cuts: The majority of people think it’s a hike.

In reality, per the Tax Policy Center, the tax bill will lower taxes for all income groups. About 80 percent of people will see a cut in 2018, with another 15 percent facing about the same tax burden. Yes, that’s the same Tax Policy Center whose study is being used as the basis for the claim that the bill increases middle-class taxes.

Other critics have chosen to mischaracterize tax provisions such as the deductions for mortgage interest and state and local taxes, casting them as bedrocks of middle-class financial stability when in reality they disproportionately benefit the wealthy. Over 90 percent of the SALT tax deduction’s value goes to filers making over $100,000. The mortgage-interest deduction not only serves to favor homeowners over renters, even though homeowners are generally more well-off, but it flows to the wealthiest homeowners in particular. Fewer than half of homeowners claim the deduction. And like the SALT deduction, the mortgage-interest deduction’s value flows overwhelmingly to those making over $100,000 per the Joint Committee on Taxation.

In other words, these are fundamentally regressive tax breaks that were inevitably going to take center stage in any real reform and have been a priority for tax reformers across the spectrum. Alas, now that the moment has come, too many have chosen to demagogue. Over the weekend, the inimitable Dianne Feinstein (D., Calif.) complained in a tone-deaf tweet that limiting the mortgage deduction would be unfair to . . . millionaires.

There are valid and important criticisms to be made of the GOP’s tax legislation — not the least among which is that it will increase the deficit — but these are crowded out by the attention-grabbing takes that misrepresent for clicks (and subsequently mislead voters). Journalists worried about democracy dying in darkness ought to be informing their audiences of the facts, and tailoring their commentary accordingly. When the facts themselves are lost to fuel a narrative, our civil society is lost too.

READ MORE:

READ MORE:

Tax Reform: A Mixed Bag

NR Editorial: A Solid Accomplishment on Taxes

What Happened to Fiscal Responsibility?

— Jibran Khan is the Thomas L. Rhodes Journalism Fellow at the National Review Institute.

Jibran Khan — Jibran Khan is the Thomas L. Rhodes Journalism Fellow at the National Review Institute.

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