U.S. Bishops: “unconscionable” tax bill raises taxes on the poor to pay for cuts for the wealthy

House Ways and Means Committee Chairman Kevin Brady, R-Texas, joined by Speaker of the House Paul Ryan, R-Wis., right, holds a proposed "postcard tax filing form" as they unveil the GOP's far-reaching tax overhaul, the first major revamp of the tax system in three decades, on Capitol Hill in Washington, Thursday, Nov. 2, 2017. (AP Photo/J. Scott Applewhite)

Catholic bishops say the G.O.P.-backed tax reform plan is “unconscionable” and “unacceptable,” pointing to “fundamental structural flaws” that they say “will raise income taxes on the working poor while simultaneously providing a large tax cut to the wealthy.”

In a letter sent to members of the House of Representatives, three U.S. bishops who head committees on domestic justice, international justice and Catholic education examined the tax proposal, which cleared a key procedural hurdle on Nov. 9, saying that the proposal did not meet moral criteria “centered on care for the poor and concern for families.”

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The bishops charged that the G.O.P. tax proposal “appears to be the first federal income tax modification in American history that will raise income taxes on the working poor while simultaneously providing a large tax cut to the wealthy.

“It must be changed for the sake of families—the bedrock of our country—and for those struggling on the peripheries of society who have a claim on our national conscience,” reads the letter, signed by Bishop Frank J. Dewane of Venice, Fla., Bishop Oscar Cantú of Las Cruces, N.M., and Bishop George V. Murry, S.J., of Youngstown, Ohio.

The letter cites many areas of concern, including estimates that show tax rates going up for the poor while the wealthiest Americans would see big tax cuts.

“No tax reform proposal is acceptable that increases taxes for those living in poverty to help pay for benefits to wealthy citizens.”

“No tax reform proposal is acceptable that increases taxes for those living in poverty to help pay for benefits to wealthy citizens,” the bishops wrote.

They note that the Catholic Church supports a “progressive tax code” that places a higher burden on the wealthy than the poor, and they said that this plan fails in that regard.

“In the years that the working poor suffer a tax increase under this bill, millionaires and billionaires will see significant tax decreases,” they wrote. “This must be fixed.”

The Trump administration and congressional Republicans want to pass tax reform before the end of the year, following failures to deliver on many of the president’s campaign promises, including a pledge to repeal the Affordable Care Act.

But bishops say the deadline does not allow enough time for debate.

“Because tax policy is far-reaching, Congress must provide ample time for Americans to discuss the complexities of these reforms and fully understand their effects,” they wrote. “The current timetable does not provide adequate time for that discussion.”

The bishops did praise some elements of the bill, including an expansion of the child tax credit and a provision they say could expand “access to schools of choice.” But overall, the bishops said the process had been too rushed and that the bill needed to be reworked.

The bishops also fear that the resulting deficit from the tax proposal will be used as justification for future cuts in social welfare programs.

“The bill raises taxes on the vulnerable and creates a strong incentive to cut the social safety net”

“Rather than exploring even modest reductions to these dramatic cuts for the wealthiest, the bill raises taxes on the vulnerable and creates a strong incentive to cut the social safety net,” they wrote.

In a section about how the bill would impact families, they wrote that the bill “places new and unreasonable burdens on families, especially those who welcome life or experience serious hardships.”

They highlighted the removal of a tax credit for adoption as one area of concern, though an amendment to the original bill inserted it back into the bill that could be voted on as early as next week. (A separate plan under consideration in the Senate also retains the adoption tax credit, the Associated Press reported.)

Other items they say could harm families include the elimination of a tax credit for medical debt and child care and stricter rules around parents’ social security numbers, a provision they say could harm immigrants.

The letter also takes aim at a provision of the bill that critics say could result in lower donations to charities and churches. Under the G.O.P. plan, the standard deduction would double, offering less incentive for individuals to donate to charity to lessen their tax burden.

“The tax code should encourage voluntary association, mutual aid, and a culture of giving, helping rather than hurting groups that will be asked to do more for the poor in the days ahead,” the bishops wrote.

Toby Gillis
1 week 4 days ago

Wow, the truth comes out in the last two paragraphs.......

Veritas Splendor
1 week 4 days ago

This article is complete polemic with no basis in fact! It makes many "conclusions", but does not give one specific detail in support . America, you should be ashamed of publishing such garbage. Yellow journalism is beneath you!

Dionys Murphy
1 week 4 days ago

Says the person who goes on a polemic rant not based in fact yet comes to conclusions without giving specific details in support. I guess projection isn't just something they do at the movie theatre.

Ellen B
1 week 3 days ago

It's appalling that you would sign yourself "The Splendor of Truth" while posting such a statement. The facts abound outside of this magazine. The only beneficiaries of a tax cut are the top 1% & Corporations. It's been tried in Kansas & has resulted in a massive debt. There is no "fairness" within the current proposal.

Veritas Splendor
1 week ago

What's appalling is that you cannot name any credible, objective, verifiable sources supporting your claims. Have you even read the proposals?

Emmett Burke
1 week 4 days ago

Seems pretty clear to me what America is saying. The article identifies the element of the bill and indicates the impact. The facts of the matter is that the proposed tax reform is even more of a give away. The Republicans are doing what the did on health care, namely, pushing things through without any Democratic comment. They simply want to please their wealthy donors and sell it those poor folk that they coned into voting for them.

Stuart Meisenzahl
1 week 4 days ago

YIKES....sounds to me from this article that the Bishops really think "it is their contribution Ox that is being gored"
If the Bishops believe that this plan has been designed to help the wealthy, then I think they have failed to read the sections where the wealthy 1) lose the deduction for state and local taxes , 2) suffer the limits on large mortgage/big house interest deduction, 3) lose the basic $24,000 earnings deduction, and 4) find that the current top rate of 39% is kept.
Contrary to the Bishops' position, the economic analysis complaint has been that there is no benefit in any the changes for the top 10% of taxpayers who account for 70% of total federal income taxes.

Dionys Murphy
1 week 4 days ago

The non-partisan Tax Policy Center disagrees: "the TPC focuses on the probable distribution of the tax cuts in the GOP plan. In 2018, taxpayers on the bottom 95% of the income ladder would get cuts between 0.5% and 1.2% of their income. Those in the top 1% would get a cut worth 8.5% of their income." The reality is that the tax proposal is a tax-cutting boon for the wealthy that does so at the expense of the poor and explodes the deficit (ironically by the same group of whiners that moaned for years about the deficit). The top 10% benefit from a cut in the top marginal tax rate to 35% from $39.6% as well as incredibly large cuts in individual businesses (ask Trump how much this will benefit him and his cronies). It's criminal. Like so many people in the current administration. It's a shame that taking advantage of the poor in a rapacious manner isn't also treasonous.

Stuart Meisenzahl
1 week 3 days ago

Tax Policy Analysis was done almost three weeks before the House or Senate Bill were "revealed".....Actual House Bill keeps top rate a 39.6% for tax payers earning over $1,000,000: Senate Bill top rate is 38.5%. Check the actual Bills as proposed yesterday !
Please see your quote from TPC which specifically says it is focusing on ...." the PROBABLE distribution of tax cuts in the GOP Plan". It used the words "probable distribution " because there was no plan at the time of its analysis! It was a sher speculative guess. A boat load of Democrats who claimed that earners under $86,000 would get a tax increase under the proposals were given 4 Pinnochios by the Washington Post ....a paper otherwise firmly opposed to any tax change.

I fully agree that the Republicans have ignored their usual deficit mantra but note that the Democrats who have never seen a deficit that didn't love have suddenly become economic deficit conservatives!!
Under either the House or Senate Bill's Mr Trump and his wealthy cronies will be paying as much and probably more in taxes given the rate of 38.5% or 39.6% and the cumulative loss of deductions under either Bill

Michael Barberi
1 week 3 days ago

Stuart,

It seems that those who listen to the media and democrats are echoing their mantra that the House and Senate Bills will increase taxes on the poor and middle class and give a tax cut to the wealthy. As your rightly pointed out, this is partisan exaggeration and highly misleading. No one has put pencil to paper and given examples to support their conclusions, including the Bishops.

Until I see more details that are comprehensive and accurate, I remain cautiously optimistic. We all need a large stimulus tax cut plan to get this economy moving again and create better paying job opportunities. Most college graduates that are young (e.g., 40 and younger) do not have the opportunities that many of us had from 1980-2000. I know the world has changed since then, but while I have an MBA in Finance I have not seen anything yet that intellectually persuades me to believe all the B.S. about what this tax bill will do.

The Bishops, and this article, are a good example of a lot of assertions but no solutions, accurate analysis or details.

Thanks Stuart for pointing out what we do know for now. Both tax bills are not perfect and there will be more haggling and amendments to come. My advise is simple: Let's see what the real benefits and disadvantages are before jumping to conclusions.

John Walton
1 week 3 days ago

Bad math, and bad research. So much for C-Student journalists. The top marginal rate remains 39.6%

John Walton
1 week 4 days ago

Perhaps the utility of 4-function calculators has been lost in the syllabus at seminary. As presently constructed the tax plan in the House of Representatives will RAISE the taxes paid by the 20% who pay 90% of Federal Personal income taxes.

Randal Agostini
1 week 3 days ago

Interesting logic: I should have my taxes raised so that I seek relief in giving my money away. If I had more of my earnings in my pocket, would I not then have greater ability to give more away?
Before I can get my mind around the "unconscionable" aspects of this bill I think I should know how wide are the bishops phylacteries?

Dionys Murphy
1 week 3 days ago

"If I had more of my earnings in my pocket, would I not then have greater ability to give more away?" No. "Common sense" without basis in fact or process is the greatest challenge the GOP faces. Because "common sense" doesn't reflect reality. It's the wealthy who will have "more of my earnings in my pocket," and they only give money when it benefits them on taxes, which is the provision that is being removed. The upper middle through lower classes, who give quite a bit, will not be able to give as much because there's no tax provision for relief of taxes in relation to donations. I know two-three step processes are difficult for GOP supporters to understand, but once you write it down and compare numbers, again not a GOP strong point, it becomes apparent.

Ellen B
1 week 3 days ago

Under the current proposal your taxes WILL be raised unless you are in the top 1% or a corporation.

John Walton
1 week 3 days ago

That is completely incorrect. Under the house plan, the top marginal rate remains 39.6% but the elimination of deduction for state and local income and property taxes, elimination of the deduction of mortgage interest means that for the top 1% taxes will rise. When you examine the entire plan, taxes are likely to rise for the 20% of individuals who pay 90% of federal income taxes. Please to do your calculations more carefully.

Wilfreda Castellanos Rodriguez
1 week 3 days ago

Regarding the poor vs the rich, given the obscene wealth of Democrat and Republican leaders currently serving in the US Congress and retired from public office (Bill Clinton and Hillary Clinton, Barack Obama, George H. W. Bush Sr, etc ), clearly neither political party smells like a rose. If anything they are a culture of cult, to paraphase Donna Brazile.

Americans got what they wanted much like the Old Testament Jews creating a golden calf while rejecting YWHW. We are now seeing how gullible, partisan and hypocritical both sides of the aisle are. Nothing ever changes in the human experience.

Flat tax rate would be the only equitable way to go. Give to Caesar what is Caesar’s. The rest of us...all of us....should be caring for the poor instead of lobbing this responsibility to the political hacks running our nation.

The Tax Policy Center admitted they made mistakes in their initial analysis of the proposed Tax Bill. As of Nov 10, their new analysis concluded the following verbiage listed on their website:

“In 2027, 59 percent of taxpayers would see an average tax cut of about $2,300, while at least 25 percent of taxpayers would face an average tax increase of nearly $2,100 (table 4). The percentage of tax units with a tax increase is similar across most income groups but well below average for the bottom quintile (14 percent) and significantly above average for taxpayers between the 90th and 95th income percentiles (47 percent). Many higher-income taxpayers with a tax increase are affected by the loss of itemized deductions. Because the legislation substantially increases the standard deduction and repeals many itemized deductions—including the deduction for state and local income and sales taxes—the number of taxpayers who elect to itemize compared with current law would fall 75 percent in 2018 (to 12.5 million tax units) and 65 percent in 2027 (to 20 million tax units).”
http://www.taxpolicycenter.org/sites/default/files/publication/147726/2…

Dionys Murphy
1 week 3 days ago

"Flat tax rate would be the only equitable way to go." Thank goodness the Church disagrees with this assessment because it recognizes that those that make the most wealth have the most negative impact in the world. Wealth is built upon the backs of others, primarily the poor, and those who earn the greatest wealth do so on the backs of the oppressed and the poor and should by necessity, in a world that recognizes such a Truth, be giving back to the world they pillage in the name of money.

Ellen B
1 week 3 days ago

The "tax cuts" result in more money paid by everyone except the top 1% & corporations while simultaneously driving up the national debt. Morality aside, it makes no sense from an overall financial perspective.

Stuart Meisenzahl
1 week 3 days ago

Ellen
Please read the proposed Bills ....the average top 1%ers do not get a tax cut: they get nothing, nada, zero. Those between about$450,000 and $1,000,000 do get a benefit but those over $1,000,000 do not. The average top 1%er earns above $1,000,000.

Chuck Kotlarz
3 days 11 hours ago

How about a 90% top tax rate on income over $10 million? That should not bother the average million dollar a year 1%er.

Chuck Kotlarz
1 week 3 days ago

The Boston Globe notes S&P 500 corporations in 2014 spent all but 2 percent of their profits on buybacks and dividends. Proposed cuts to the corporate income tax code total more than $800 billion over the next 10 years. That’s $800 billion more profit for stock buybacks and dividends and $800 billion more federal debt paid for by soaking the kids and grand kids.

The corporate “tax cut” indirectly hands over a fat pay raise to the 400 wealthiest U.S. households who receive nearly 75 percent of their income from stock dividends and capital gains from selling stocks.

The individual tax cuts, which total more than $800 billion over the next 10 years, are also paid for by soaking the kids and grand kids. For Trump and his family, the tax cut leaves them a billion dollars richer.

Stuart Meisenzahl
1 week 3 days ago

Chuck

Your favorite "go to" economic liberal Warren Buffet has taken exactly the opposite view of Stock Buy Backs ....see his 2016 Letter to Shareholders of Berkshire Hathaway.
The Boston Globe article you cite was by Professor Lazonick of Lowell Mass and the basis for that is his monograph "Profits without Prosperity " in which his argument is that SEC rules on buy backs allow market manipulation to the benefit of the executives controlling the buy back. He does not argue that the buy backs only benefit the top 400 wealthiest.
Indeed he could not make such an argument because there is no fact base for determining precisely what stocks those wealthiest 400 Americans own , or what stocks they own that have been subject to buy backs. Perhaps you have such facts at your disposal?

Chuck Kotlarz
1 week ago

Tax cuts are GOP "go to". Explain why the Reagan and Bush tax cuts trashed the national debt, the tax base, the ninth worst economic instability since 1856 and thirty plus years of failed trickle down wages.

Stuart Meisenzahl
1 week ago

Chuck
You keep changing the content of your own arguments...
Now as to your last above: You state that Regan Bush cut taxes and increased the National Debt. But please note again that Barack Obama increased taxes AND doubled the National Debt!!
There is no demonstrable direct causation between tax rates and National Debt WITHOUT LOOKING AT SPENDING,!
Tax rates did not "trash the National Debt" ..........spending in excess of receipts trashed the National Debt.....and that includes SS Taxes and Medicare Taxes falling short of those needed to fund those "off balance sheet liabilities"!

Chuck Kotlarz
3 days 10 hours ago

National debt as a percentage of GDP exploded thirteen points under Bush after falling nine percentage points under Clinton.

With the Great Recession not yet ended, debt exploded another sixteen percentage points in the year after Bush left office. Recall Bush inherited a budget surplus forecast to last as far as the eye could see.

The deficit, which reached a staggering $1.55 trillion in the 2009 fiscal year, then declined yearly, falling fifty percent by 2013, the year of Obama’s tax increase.

Stuart Meisenzahl
2 days 22 hours ago

Chuck
You provide more totally misleading statistics:
First and foremost taxes and spending are primarily products of Congress not a President. It is far more accurate to track deficits by the party control of Congress
The Clinton PROJECTED surplus was a product of a Republican Congress and Democratic President controlling spending....remember Bill Clinton's famous "The era of big government is over " speech. The projection of a surplus was tied directly to continued spending controls, not tax policy. Further there never was an actual surplus.....there was a projection of a future surplus over the following 10 years, and it assumed limited increases in spending during that period.

Bush's deficits are not primarily products of tax policy but rather of spending on two wars brought on by 9/11......wars approved by a bipartisan congressional vote. That spending increase negated the assumptions underlying the previously projected surplus.
Obama and the Democratic Congress ran up a$10Trillion total increase in the National Debt despite a tax increase.......the cause was spending!
$1 Trillion of the 2009 -2010 deficit is directly attributable to the failed Obama Stimulus and subsequent $ Trillions were added by Obamacare. .....Again spending beyond receipts. Indeed the Obamcare taxes provided receipts to offset deficits for three years before Obamcare's actual costs fully kicked in!
You keep avoiding the question of how we are going to pay down the National Debt in the face of rising interest rates without growth in the economy beyond 2% per year. Further, it has been demonstrated by the past four years that wages will not increase with a 2% annual growth rate. No economist thinks you can tax your way out of these problem.
You can grow your way out of the problem or you can cut the built in Federal Program spending increases and curtail adding programs. Since the Social Justice Warriors will never agree to spending cuts, the only option left is growth!
Increases in taxes are antithetical to growth, an effect compounded by the gross inefficiencies of government spending.
Exactly how much do you believe your suggestions for massive increases in taxes on the top 1%ers would yield? [As already noted , if you outright seized all of the 1%ers wealth the National Debt would still be at Pre Obama era levels of $10 Trillion.] What would such levels of taxation do to chill the 1%ers reinvestment in new businesses and maintaining marginal businesses?
If it's a given that we are not going to cut spending, just exactly what change in policies do believe would cause growth greater than 2% per annum?
Trump has started with "deregulation" which is just another way of reducing business costs. This has already caused some increase in growth. The question to be answered is whether a proposed corporate tax cut will stimulate even greater growth.
For my part, I would continue deregulation; cut corporate taxes; leave all individual tax rates the same; and freeze all additions to the cost of Federal programs (no increases).

Chuck Kotlarz
2 days 6 hours ago

Stuart, the share of income for the bottom 95% has been falling since 1980. Why would anyone invest in a dying market segment?

What would I do to increase growth? Apply a 90% tax rate on income over $10 million, restore a 77% tax on estates over $10 million and apply a 25% capital gains tax.

I heard of a high school student that goes to college for a class. He does not take the class, he teaches it. My gut feel is millennials are a great generation waiting to happen. One talented kid can’t do it by himself. A living wage would help jump start the millennial generation.

Stuart Meisenzahl
1 day 14 hours ago

Chuck
I suggest you run your recipe for " growth" (as stated by you above) by any economist and see what his reaction is. All you have suggested is the Obama recipe times 2.
You don't mention the Corporate tax rate, so I assume you would leave it at 35%. Nor do you mention any budget controls.
It's this general approach which brought us the current lousy 2% growth rate....Now being defined as the new normal! Combine that with your suggested $15 minimum wage and your lack of any proposal to restrain federal spending and you have created a fairly fast fuse economic time bomb.
Under your proposal It strikes me that there will be no estates over $10M .....that money,like the current corporate stash of $2+ Trillion, will go abroad or be locked up in foundations like the Buffet and Gates Foundations. A 77% tax on income above $10 million will probably lead to a lot of ex patriots as France experienced when it tried that approach. Not to mention entrepreneurs starting their businesses in more favorable tax rate countries.

Dionys Murphy
1 week 3 days ago

It's easy to see who will benefit most by those who are pushing Washington to get it passed ---
The wealthy:

"“The most excited group out there are big CEOs, about our tax plan,” Gary Cohn, the leading White House economic adviser and former chief operating officer at Goldman Sachs, said in an interview with CNBC on Thursday."

"“My donors are basically saying, ‘Get it done or don’t ever call me again,’” Rep. Chris Collins (R-N.Y.), himself a millionaire, said on Tuesday.

Sen. Lindsey Graham (R-S.C.) told reporters on Thursday that a failure to pass tax reform would fracture the Republican Party and lead to more far-right wing primary challengers. “The financial contributions will stop,” he added."

Stuart Meisenzahl
1 week 3 days ago

You quote Cohen out of context.....CEO's are in favor/excited because they see economic growth stemming from the Corporate Tax cut.
Your other two quotes were similarly out of context: Both Collins and Lindsey were citing promises made as part of their re-election to get something done and fulfill campaign promises or they would lose their supporters.

Perhaps you could enlighten us as to whom you define as wealthy?

bill bladykas
1 week 3 days ago

Bishops are way off base. Firstly no bill has been passed and there is no tax increase suggested on the 47% that don't pay federal income taxes to start with.

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