Millionaires Would Gain Trillions Under Trump and Cruz Tax Plans
 Isaac Shapiro, “Trump and Cruz Tax-Cut Plans Would Shrink Government to Truman-Era Levels,” Center on Budget and Policy Priorities,” March 29, 2016, https://www.cbpp.org/research/federal-tax/trump-and-cruz-tax-cut-plans-would-shrink-government-to-truman-era-levels.
 As noted, all average tax cut figures in this analysis are expressed in 2016 dollars.
 The TPC’s methodology establishes income percentile classes based on the number of people rather than the number of “tax filing units” or households. That is, each quintile class in the TPC data includes one-fifth of the U.S. population, not one-fifth of households.
 In 2025, the average after-tax gain for all households would be an estimated $5,300 under Trump, a 6.9 percent gain, and $5,200 under Cruz, a 6.8 percent gain.
 Under both plans, the after-tax income gains to millionaires would be several times greater than the gains for millionaires under the tax cuts that were enacted in 2001, 2002, and 2003 under the Bush Administration, which increased the after-tax incomes of millionaires by 7.1 percent. See Isaac Shapiro and Joel Friedman, “Tax Returns: A Comprehensive Assessment of the Bush Administration Tax Cuts, April 2004, p. 20, https://www.cbpp.org/sites/default/files/atoms/files/4-23-04tax.pdf.
 As discussed in detail in the previous companion analysis, the TPC revenue loss estimate for the Trump plan is lower than the other two available estimates of the plan’s cost (one by Citizens for Tax Justice and the other by the Tax Foundation) and is in the middle of the estimates for the Cruz plan. The Appendix in the previous analysis also discusses why it is highly implausible to assume that the tax cuts would largely or completely “pay for themselves” by generating dramatic increases in economic growth.
 To calculate the revenue loss attributable to millionaires, this analysis first adjusts the total revenue loss estimates made by TPC slightly downwards. As noted in the previous companion analysis, TPC’s estimates of the ten-year revenue loss associated with each plan were based on economic projections made in 2015. We adjust those figures to take into account the most recent economic data. As a result, we estimate a ten-year revenue loss of $9.2 trillion for the Trump plan and $8.5 trillion for the Cruz plan (compared to TPC estimates of $9.5 trillion and $8.7 trillion, respectively).
Second, TPC only estimates the distribution of the tax cuts for two years, 2017 and 2025. To estimate the distribution of revenue loss over the ten-year period, this analysis averages the share of the tax cuts received by millionaires in those two years and multiplies the result by the ten-year revenue loss that TPC has estimated. So, for example, TPC found that under the Trump plan, millionaires would receive 31.4 percent of the total tax cuts in 2017 and 38.0 percent in 2025, yielding an average of 34.7 percent. We use the same approach for the Cruz calculation.
Finally, the size of the tax cut going to millionaires is likely to differ slightly from what applying the average shares would indicate because of the effects of capital gains tax cuts. Both plans propose lower rates for capital gains, which are likely to induce taxpayers to sell more appreciated assets than they would have under current law. The increase in revenue from the sale of these assets offsets some of the revenue loss from the lower rates. Since millionaires receive a significant majority of all capital gains, this offsetting effect disproportionately reduces the revenue loss attributable to the tax cuts for millionaires. This effect is not fully captured in an average-share calculation. Based on TPC data as well as CBO projections of capital gains taxes under current law, we estimate that the revenue loss for millionaires would be roughly 1 percent lower under the Trump proposal and roughly 3 percent lower under the Cruz plan than the average-share estimates alone indicate.
Taken together, these steps result in the following calculations of revenue loss: $9.2 trillion*.347*.99 = $3.2 trillion for Trump, and $8.5 trillion*.429*.97 = $3.5 trillion for Cruz.
 Shapiro, 2016.
 Note that the TPC estimates of the effects of the tax cuts also consider any additional revenues gained from Trump or Cruz proposals to eliminate tax loopholes or otherwise increase certain taxes.
 Even if all direct program transfers to millionaires were eliminated immediately, a rough CBPP estimate suggests this would offset less than 5 percent of the cost of the tax cuts to millionaires over the next decade. While transfer programs make up a significant majority of federal spending, millionaires, like other households, also benefit from other programs — such as spending on defense, infrastructure, and the environment. In contrast to the tax cuts proposed by Trump and Cruz, however, the benefits from these other programs are largely public goods and are broadly shared.
 Citizens for Tax Justice (CTJ) examined the net dollar effect of the Trump and Cruz tax-cut proposals once offsets are considered. CTJ assumed half of the offsets would come in the form of spending reductions and half in the form of tax increases (thus effectively reversing at least some of the tax cuts). CTJ assumed the spending cuts would reduce each person’s income by the same dollar amount and that the tax increases would come in the form of an across-the-board increase in income taxes that would reduce each household’s income by the same percentage. It found that all income groups except for the top 5 percent under Trump and the top 20 percent under Cruz would be net losers under the tax plans once such offsets are assumed. So even under the relatively progressive offset assumptions CTJ used (which include tax increases), low- and middle-income households would lose more from the offsetting measures than they would gain from the tax cuts themselves. Citizens for Tax Justice, “The Net Effect: Paying for GOP Tax Plans Would Wipe Out Income Gains for Most Americans,” March 9, 2016, http://ctj.org/ctjreports/2016/03/the_net_effect_paying_for_gop_tax_plans_would_wipe_out_income_gains_for_most_americans.php#.VuBUWNDYHOA.
 Assuming the offsets come in the form of spending reductions, households with annual incomes of less than $1 million but still in the top fifth of the income spectrum are, on balance, likely to gain significantly as well, though not nearly to the disproportionate degree as millionaires.
 Richard Kogan and Isaac Shapiro, “House GOP Budget Gets 62 Percent of Budget Cuts From Low- and Moderate-Income Programs,” March 28, 2016, https://www.cbpp.org/research/federal-budget/house-gop-budget-gets-62-percent-of-budget-cuts-from-low-and-moderate-income. The House Republican budget also contains $2.3 trillion in other program cuts that would affect the broad population.
 For example, the Urban Institute estimated that a policy package that would reduce the number of children in poverty by 60 percent would cost about 0.5 percent of GDP, or one-third of the resources devoted to the tax cuts for millionaires under the Trump and Cruz plans. Children’s Defense Fund, Ending Child Poverty Now, 2015.
 Emily Feenstra, “Our Nation’s Neglected Infrastructure,” Contingencies, September/October 2015, http://www.contingenciesonline.com/contingenciesonline/september_october_2015?pg=26#pg26.