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Louis Jacobson
By Louis Jacobson January 16, 2018

DNC offers one-sided view on who gets tax bill's benefits

The Democratic National Committee said one of President Donald Trump’s proudest achievements from his first year is really a giveaway to the country’s wealthiest people.

"Trump and his party spent the better part of the year trying to take away health care from tens of millions of Americans to pay for a tax cut for the rich, and when that failed, they passed a tax bill that gave 80 percent of its benefits to the top 1 percent," said a Medium post that the party published Jan. 16.

A reader asked us to look into a couple of claims from the post.

In this fact-check, we wondered whether it is correct that the Republican tax bill "gave 80 percent of its benefits to the top 1 percent."

The source footnoted in the post is an analysis of the final version of the tax bill by the nonpartisan Urban Institute-Brookings Institution Tax Policy Center.

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The Tax Policy Center analysis found that by 2027, the tax bill would deliver 82.8 percent of its benefits to the top 1 percent of the income spectrum.

However, in earlier years, the distribution of benefits would look very different.

For instance, in 2018, according to the center’s analysis, the bill would deliver 20.5 percent of the benefits to the top 1 percent — vastly less than the 83 percent figure the DNC touted. And as late as 2025, the center projected, 25.3 percent of the benefits would flow to the top 1 percent.

The main reason: By 2027, a number of key tax provisions that benefit middle-income taxpayers will have expired unless Congress extends them. In addition, the new tax law changed how inflation was calculated, in a way that will be less generous to taxpayers as time goes on.

"How much of the benefit of the tax bill goes to the top 1 percent income group greatly depends on what year you are looking at," said Joseph Rosenberg, a senior research associate at the Tax Policy Center.

Our ruling

The DNC said that the Republicans "passed a tax bill that gave 80 percent of its benefits to the top 1 percent."

That’s the case by 2027, due to the expiration of several important middle-income tax cuts and a change in how inflation is calculated. However, through 2025, the share of benefits going to the top 1 percent is much smaller, at roughly 20 percent to 25 percent. The DNC is cherry-picking by focusing on the tax bill’s impact by 2027, rather than the impact for the nearly a decade leading up to then.

We rate the statement Half True.

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Half True
The Republicans and President Donald Trump "passed a tax bill that gave 80 percent of its benefits to the top 1 percent."
a Medium post
Tuesday, January 16, 2018

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DNC offers one-sided view on who gets tax bill's benefits

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