The House will vote today on the Ways and Means Committee’s “2.0” tax plan, which would double down on the fundamental flaws of the 2017 tax law. As we’ve explained, the bill would make permanent the law’s individual provisions and thereby favor the wealthy, worsen the nation’s long-term fiscal challenges, and encourage rampant gaming of the tax code. Rather than enacting this fundamentally flawed legislation, policymakers should set a new course by restructuring the 2017 tax law.
This bill would exacerbate the trend of skewed benefits to the wealthiest. Households in the top 1 percent would see their after-tax incomes rise 2.0 percent (or an average of $40,180) while those in the bottom 60 percent would receive only a 1.1 percent ($480) boost (see first chart).