Americans for Prosperity recently held a Taxpayer Town Hall in Hiawatha to discuss the topic of state-level tax reform. The forum aimed to focus on where Iowa has done well recently concerning our tax code, and most importantly, where our state still has room to improve and become more competitive with other states.
However, it’s surprising that with all the talk of tax reform in Iowa, not much has been said about the effect the 2017 Tax Cuts and Jobs Act had on our state’s tax system. The very policy conservatives promised would be “rocket fuel” for our economy has not helped most Iowans, and is drastically increasing our state’s inequality.
In fact, last year the tax cut for the wealthiest Iowans averaged $35,090. Juxtapose that with the tax cut for the poorest Iowans — the 20 percent earning less than $25,000 — a measly $80.
So where should the money go? If you would take half of the annual tax breaks the richest 1 percent of Iowans received — $650 million — it would pay for the salaries of more than half of all public school teachers in the state.
We are a decade out from the 2008 recession and are staring into the face of another one. Federal rules have incredible ramifications when it comes to Iowa’s tax structure and the federal government provides revenue for state expenditures. When those funds are reduced or eliminated by giving even more breaks to the uber wealthy and corporations it hurts all of us.
The federal tax plan actually raises taxes on 53 percent of American families, including 92 million middle-class families, while 83 percent of the benefits go to the wealthiest 1 percent of Americans. And this is happening under the very same tax plan that has stripped health care away from 13 million Americans, and completely sabotaged the insurance market. One of the promises of the 2017 tax plan is that corporations would use the trillions they received in tax cuts to better the lives and working conditions of their employees.
But that hasn’t been the case.
We hear stories of companies giving back to their employees with bonuses, but workers need higher wages and better benefits — not one-off payments. According to Americans for Tax Fairness, more than twice as many workers are getting bonuses as raises.
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While the lies of middle-class tax cuts and extra money in our pocket from conservatives may sound good, the reality is that the wealthy are getting the breaks and the rest of us are going broke, with about 13 million Americans working more than one job to make ends meet.
A tax law that works for all of us is the key. Instead of giveaways for the rich, we need them to pay their fair share. It’s unfathomable that we live in a country where the 400 richest Americans own more wealth than 150 million low-and-middle class adults. We should not have to pay the price for corrupt policies like the GOP tax plan that leaves us our communities even more vulnerable with a possible recession ahead.
Plain and simple, a fair tax code will help our state and our country when it comes to true priorities: funding education, infrastructure, health care and the well-being of our family, friends and neighbors.
It’s time to tax the rich, and yes — it’s just that simple.
Sue Dinsdale is executive director of Iowa Citizen Action Network and leads the Tax March Iowa Chapter.