Governor Wolf Urges Congress to Vote No on Tax Reforms that Prioritize the Wealthy Over the Middle-Class
December 19, 2017
Harrisburg, PA – In a letter to Pennsylvania’s congressional delegation, Governor Tom Wolf again expressed concern over the current tax bill, citing its prioritization of the uber-wealthy over its support of the middle-class as previously promised. The governor urged Congress to vote no on the current bill, which enacts permanent tax cuts for large corporations and increases the tax burden on Pennsylvania’s homeowners and middle-class.
“This bill is bad policy and a giveaway to the uber-wealthy and corporations,” Governor Wolf said. “I am urging Congress to vote no and work on real tax reform that will benefit the middle-class. Further, I am gravely concerned about how the trillion dollar deficit from this bill will be used to cut health care programs like Medicare and Medicaid.
Several members of Pennsylvania’s Congressional delegation were in attendance in October when President Trump visited Harrisburg to talk about tax reform. In his speech, the President said that tax reform would be a “middle-class bill” and that the benefits would go to “the middle-class and not the highest earners.” The bill you will be voting on does not do that.
There are clear winners and losers under this bill. A large corporation will see a permanent 14 percent tax cut while an individual making $40,000 will see their modest tax cut disappear by 2023. More than half of the tax cuts in this bill go to the top 1% while Pennsylvanians earning less than $75,000 will pay more in taxes by 2027. In total, 713,000 of our constituents will see a tax hike by 2027.
This “middle-class” bill will raise the threshold to qualify for the estate tax, which benefits only the wealthiest 140 estates in the commonwealth. These 140 estates, all worth over $22 million will see a tax cut of $4.4 million. That $4.4 million could be used to provide 1100 Pennsylvania students a Pell Grant to make college more affordable.
Homeowners who utilize the State and Local Tax (SALT) deduction will see their deduction capped under this bill. SALT ensures that Pennsylvania families won’t be taxed twice by the federal government on what they’ve already paid in state and local taxes. The majority of Pennsylvanians who use the deduction have an income under $100,000. These changes to the deduction will increase the tax burden on homeowners by as much as $1600 per year. The increased tax burden on homeowners may force our communities to make cuts to emergency services, infrastructure projects, and education.
Pennsylvanians’ concerns with this bill are not limited to the changes to tax policy. The Congressional Budget Office estimates that repealing the Affordable Care Act’s individual mandate would increase premiums an additional 10 percent each year. Pennsylvania would see an additional 500,000 uninsured individuals. My administration has worked to bring the commonwealth’s uninsured rate to the lowest on record. Eliminating the individual mandate is a step backwards
According to the Joint Committee on Taxation’s score the GOP tax plan will increase the deficit by $1.45 trillion over the next ten years. Without additional Congressional action, this bill will trigger an automatic $25 billion cut to Medicare next year, along with $125 billion in cuts to other programs such as farm subsidies, health prevention funds, and student loans. Earlier this month, Speaker Ryan announced that in 2018 the House of Representatives would work to cut Medicare, Medicaid, Social Security and other entitlement programs that Pennsylvania families rely on. It is irresponsible to support a bill that adds over a trillion dollars to the deficit and then use concern over the deficit to make cut to vital programs that will hurt your most vulnerable constituents.
This bill is bad policy. It is a giveaway to the uber-wealthy and corporations. I urge you to vote no and work on real tax reform that will benefit the middle-class.