With so much at stake in President Trump’s tax scam, advocates for women and families are telling members of Congress to say NO to what Trump and the GOP have planned for giveaways to wealthy people and corporations and YES to the notion that everyone deserves an opportunity to succeed and thrive regardless of their income, identity, or background. People For the American Way joined the National Women’s Law Center, the National Partnership for Women & Families, and more than 80 other organizations to outline the tax plan’s grave threats to affordable health care, critical tax benefits, state and local revenues, and funding for programs that so many women and families count on to survive. In our November 29 letter, we make clear that when women and families lose, we all lose—this is not about “them” but about “us,” the U.S. economy, and communities large and small all across the country. You can download our letter, with signers and footnotes, here.
Dear Majority Leader McConnell, Speaker Ryan, Minority Leader Schumer, and Minority Leader Pelosi,
On behalf of the below 92 organizations dedicated to advancing the health, economic security and opportunity of women and families and eradicating their barriers to success, we write to express our opposition to the “Tax Cuts and Jobs Act.” This tax proposal threatens the economic security of women and families by gutting the Affordable Care Act (ACA), eliminating critical tax benefits for countless families, decimating state and local revenues, and undermining the funding for programs that are essential to the wellbeing of people and communities across the United States and to our country’s economy.
Republican congressional leaders are using their tax bills to attempt to gut the Affordable Care Act. The Senate version added a provision that would increase the number of uninsured people by 13 million over 10 years,1 raise insurance premiums in the individual markets by 10 percent,2 and create chaos and uncertainty in the health marketplace. This amounts to repeal without replace. The Senate has already rejected repealing the ACA, and now Republicans are trying to sneak this into their tax bills to provide even larger tax cuts for high-income households and corporations. This is unconscionable.
In addition, the Republican tax plan would disproportionately benefit wealthy Americans and corporations at the expense of middle- and lower-income families. Put simply, the tax plan would primarily benefit the richest households while giving little to nothing to tens of millions of women and families most in need of help. For example, nonpartisan estimates based on the House tax bill show that, in 2018, over 75 percent of its benefits would go to the top 20 percent of households, while the bottom 20 percent of households would only receive around two percent of the benefits.3 Female-headed households are underrepresented in the top 20 percent of households4 and are overrepresented in the lowest 20 percent.5 This leaves women who are supporting families on their own—often working long hours, at low wages, with little access to quality, affordable child care—with little meaningful help under the proposals. In fact, under both plans, millions of low and middle-income people and their families would actually face a tax increase in the long run—undercutting their future economic stability, opportunity and wealth.6
Additionally, women and families across the country would be penalized by the elimination of critical tax benefits that support millions of people and their families. For example:
- The House tax bill would eliminate the student loan interest deduction, negatively affecting women, who hold about two-thirds of all student debt (more than $800 billion).7 The repeal will especially hurt Black women, who have the highest levels of student debt. In 2012, Black women graduating with a bachelor’s degree had, on average, debt of $29,051 (compared to an average debt of $20,907 for all women and $19,454 for all men).8
- The House tax bill would eliminate the deduction for medical expenses, jeopardizing the financial security of people who have serious medical conditions and their families, as well as seniors in need of long-term care. In 2015, 8.8 million families claimed the medical expenses deduction; approximately 70 percent of them had incomes of $75,000 or less and nearly half had incomes of less than $50,000.9 Additionally, 75 percent of filers who claimed the medical expenses deduction are seniors.10
- The House tax bill actually cuts existing tax benefits for child care. The bill would eliminate child care tax benefits for families, including the exclusion of Dependent Care Assistance Plans (DCAPs) from income, beginning in 2023. DCAPs are dependent care flexible spending plans offered by employers, which allow employees to take money out of their paychecks, pre-tax, and use those dollars to pay for child and dependent care expenses. In 2016, almost 1.4 million families benefited from the exclusion of contributions to DCAPs.11 Additionally, the tax bill eliminates the tax credit for employers that offer child care benefits to their employees, effective immediately.
- Meanwhile, the Senate tax bill would completely eliminate the deduction for state and local taxes. Approximately 43 million taxpayers from all 50 states and across all income brackets benefit from the state and local tax deduction.12 Eliminating this tax benefit would not only raise taxes for millions of women and families, but it would also make it more difficult for states and localities to sustain the tax rates necessary to fund essential services such as public education and to maintain the jobs of public sector employees, the majority of whom are women and a substantial share of whom are people of color.
At the same time that the Republican tax plan eliminates numerous tax benefits for women and families, its Child Tax Credit (CTC) proposal, including a new tax credit for non-child dependents, leaves out the families who need the most help. Nearly two-thirds of minimum wage workers are women.13 Nearly six in ten people working in low-wage jobs are women—many of whom are supporting children.14 While the House and Senate tax bills propose to increase the CTC, they do not make this increase fully refundable. As a result, lower-income families will not receive the full benefit: for example, a single mother working full time at the federal minimum wage and earning $14,500 would only receive an additional $75 in CTC benefits under the more generous Senate bill.15 In addition, the tax bills add a new requirement—providing a Social Security Number for each child claimed for the refundable portion of the CTC—which could exclude a significant number of children in immigrant families. But they would immediately make families with six-figure incomes eligible to claim the CTC.
In addition, the Senate bill adds a proposal for a business paid leave tax credit that likewise would do little to increase workers’ access to paid medical or family leave.16 Today, just 15 percent of workers have access to paid family leave and fewer than 40 percent have access to personal medical leave for serious health issues.17 Because the credit only covers a small fraction of companies’ costs, it is unlikely to offer an effective incentive for more companies to offer paid leave—especially for smaller businesses. Instead, the tax credit, which the bill only puts in place until the end of 2019, would likely have the effect of subsidizing companies that already provide paid leave.18 As a result, this paid leave credit proposal simply represents another tax giveaway to large corporations in a Republican tax plan that is already replete with them while failing to guarantee the paid family leave that more than 100 million workers need.
Alarmingly, the Republican tax plan also includes an ideological attack on abortion. Both tax bills would allow an “unborn child” to be designated as a beneficiary of a 529 college savings plan. However, the current tax code already allows individuals to open a 529 savings plan and then transfer the account to a child’s name after the child is born.19 Since individuals can already open a 529 savings plan for future children, the goal of this language appears to be to advance an anti-abortion political agenda by embedding in law a definition of “unborn child”—in an attempt to set the stage to challenge the U.S. Supreme Court’s ruling in Roe v. Wade, which relied in key part on the finding that fetuses are not “persons.”
Finally, the high cost of the Republican tax plan will have a significant impact on federal funding for programs that are essential to the economic security of women and families. The House and Senate tax bills are each estimated to cost approximately $1.5 trillion over a 10-year period, although it appears highly likely that, in reality, the actual cost of either version would far exceed even this astronomically high number. This will add to the deficit and create increased pressure for Congress to cut spending for programs, including Medicaid, Medicare, child care assistance, nutrition assistance, Pell Grants, housing assistance, heating for low-income families, and more. Because women still face discrimination, a pay gap, and a poverty gap, women are the majority of beneficiaries of many of these programs and would be especially hurt if these programs are cut.
We are deeply committed to ensuring that all women and families have the opportunity to succeed and thrive across their lifespans and regardless of income, identity or background. The tax bills being considered in Congress fail to meet this standard and, instead, would set women and families back. We all deserve better. Because the changes proposed would undermine the economic security of women and families and rob our communities and the economy of essential resources, we oppose the tax plans currently being considered in Congress.