By Brandon Moseley
Alabama Political Reporter
Thursday, November 2, 2017, the Republican leadership of the U.S. House of Representatives introduced their new tax reform plan unveiled The Tax Cuts and Jobs Act, which they claim will fundamentally reform the tax code for the first time since 1986. U.S. Rep. Terri A. Sewell, D-Selma, said that the new plan is a, “Raw deal for Alabama.”
“After months of secret negotiations, it should come as no surprise that the tax plan revealed by Republican leaders today is a raw deal for Alabama and for working families,” Sewell said on social media. “The Republican tax bill will raise costs on families who can least afford it while providing wealthy individuals and special interests a windfall in tax breaks.”
Many Democrats were unimpressed with the plan.
House Minority Leader Nancy Pelosi, D-CA, said on Twitter, “A GOP tax bill that explodes the deficit by $1.5 trillion means dumping $4600 in debt on every man, woman & child in America.”
House Minority Whip Steny Hamilton Hoyer, D-Md., said on Twitter, “RT if you oppose @HouseGOP’s partisan tax bill, which will explode the deficit & hurt middle-class families to give tax cuts to wealthy.”
Republicans are cutting income tax rates across the board and increasing the child tax credit. Theoretically, that will decrease income tax collections and lead to high deficits. Republicans counter that it will stimulate economic growth and ultimately lead to higher tax collections through greater economic activity (supply side economics) leading to higher tax collections despite the lower rates.
Pelosi followed up with a series of tweets:
“The GOP secretly wrote the #BillionairesFirst tax plan in hopes that no one would catch its painful impact on middle-class families.”
“If you have student loans — or may soon have them — the #BillionairesFirst tax plan will leave you behind.”
“The #BillionairesFirst tax plan is nothing more than a shell game which will hurt millions of middle-class families.”
Democratic Governors were critical of the plan’s elimination of the state income tax deduction. High state income tax states like California, New York, New Jersey and Connecticut will be especially hard hit by the elimination of that deduction.
High income tax states tended to vote Democratic in the 2016 election; while President Donald Trump won six of the seven states with no state income tax.
“By eliminating or rolling back state and local tax deductibility, Washington is sending a death blow to New York’s middle-class families and our economy,” New York Governor Andrew Cuomo wrote in a letter to President Trump. “It’s clear this is a hostile political act aimed at the economic heart of New York.”
Sewell represents Alabama’s 7th Congressional District.
Original reporting by Reuters contributed to this report.