The 2017 Trump Tax Law Was Skewed to the Rich, It Failed to Deliver on Its Promises. A 2025 Course Correction Is Needed.
Vote for VP Harris to End the 2017 Law’s Windfalls for the Wealthy
Failing to allow the individual income tax and estate tax provisions to end as scheduled would benefit high-income households far more than other income groups. Extending them would boost after-tax incomes for the top 1 percent — those with incomes over $1 million — more than twice as much as for the bottom 60 percent as a percentage of their incomes in 2026. In dollar terms, extending the expiring provisions only (that is, excluding the effect of the large corporate tax cuts the law made permanent) would result in a $48,000 tax cut for households in the top 1 percent in 2026, but only about $500 for those in the bottom 60 percent of households, on average.
As the 2017 law’s individual income and estate tax cuts approach expiration, policymakers and the public should keep two important dynamics in mind.
First, in addition to the top 1 percent receiving very large tax cuts, the 2017 law delivered the largest average tax cut — measured as a percentage of pre-tax income — to households in the 95-99th percentiles. Their tax cut from the 2017 law amounts to 3.2 percent of their pre-tax income, on average (or nearly $13,000, on average).This is more than triple the roughly 1 percent average percentage income gain of the bottom 60 percent.