I write in response to the Your Turn guest column, “High-Tax New Jersey Could Benefit From Federal Tax Reform,” that was published in the Sept. 27, 2017 edition of this newspaper.
As it begins, the letter works toward support for the proposed “tax reform” which is currently being worked on in Washington, D.C.
However, not content in leaving that be as the purpose of the letter, the authors end with purporting Congressman William Pascrell and Sen. Robert Menendez to be against “ordinary” (whatever that means) Americans, because they both voted against the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) and the Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA), together known as the Bush tax cut.
A Center on Budget and Policy Priorities article, “The Legacy of the 2001 and 2003 ‘Bush’ Tax Cuts” by Emily Horton details the economic realities of these tax cuts:
“High-income taxpayers benefited most from these tax cuts, with the top 1 percent of households receiving an average tax cut of over $570,000 between 2004 and 2012 (increasing their after-tax income by more than 5 percent each year)”
“Tax laws enacted during George W. Bush’s administration increased the annual deficit by roughly 2 percent of Gross Domestic Product in 2010, the year the provisions were fully phased in.”
“However, in 2013 we estimated the Bush tax cuts — including the portion made permanent after 2012 — would add $4.2 trillion to deficits over 2009 to 2019, taking into account the associated debt service costs. This meant the Bush tax cuts would be responsible for roughly 40 percent of federal debt owed by 2019.”
“The Tax Policy Center estimated that in 2010, the year the tax cuts were fully phased in, they raised the after-tax incomes of the top 1 percent of households by 6.7 percent, while only raising the after-tax incomes of the middle 20 percent of households by 2.8 percent. The bottom 20 percent of households received the smallest tax cuts, with their after-tax incomes increasing by just 1.0 percent due to the tax cuts.”
So, if Rep. Pascrell and Sen. Menendez voted against the 2001 and 2003 “Bush” tax cuts for “ordinary” Americans, I applaud them.
The current proposal in Washington is clearly a page right out of the same book; thousands, if not millions, of dollars in tax relief for the 1 percent, pennies for the rest. This is not “historic tax reform” by any means.
Wayne R. Smith
Allentown
