Wednesday, May 27, 2020

Pelosi: Still Raising Taxes and Spending as Never Before

Democrats in the U.S. House of Representatives may have been stuck in their districts because of the coronavirus but Speaker Nancy Pelosi has been working hard on their behalf. On Tuesday she introduced the next in what’s getting to be a long line of COVID relief bills that, true to form, is loaded with tax and spending increases. (RELATED: Democrats Rally Around Recurring $2K Monthly Relief Checks)

According to a quick but probably not definitive analysis of what she’s calling The Heroes Act by the good folks at Americans for Tax Reform, the Pelosi bill:

  • Extends the $600 per week FPUC supplemental unemployment added to state and federal through January 31, 2021, extended it beyond the original July 25, 2020 termination date by 27-weeks.
  • Provides an additional cash payment of $1,200 per individual dependent, up to a maximum of three dependents, until it begins to phase out at $75,000 per individual in annual income or $150,000 for married couples.
  • Expands the Earned Income Tax Credit
  • Expands the Child Tax Credit through an advance refundable credit of up to $3,600 for children under 6 and $3,000 for children 6 or older.
  • Expands the child/dependent care credit for 2020 above the currently allowable credit taken against 35 percent of expenses reduced by 1 percent for every $2,000 over $15,000 in adjusted gross income by modifying it to 50 percent of expenses reduced by 1 percent for every $2,000 over $120,000 in AGI.
  • Doubles maximum credit amount from $3,000 for one qualifying dependent, $6,000 for two or more qualifying dependent and makes it refundable.
  • Allows $2,750 in FSA funds to be carried forward to 2021.
  • Increases the above the line deduction for elementary school and secondary school teachers from $250 to $500.
  • Creates $500 above the line deduction for first responders for uniforms, tuition, and fees.
  • Creates a temporary above the line deduction for employees on the “front lines” of the COVID crisis for uniforms, supplies, and equipment for 2020.
  • Provides a payroll tax credit for pandemic related employee benefit expenses, limited to payments of $5,000 per employee, per quarter.
  • Expands the employee retention credit created by the CARES Act. Currently, businesses are allowed a payroll tax credit against 50 percent of qualified wages up to $10,000 in wages per quarter. The new legislation would expand this to 80 percent of wages up to $15,000 per quarter, not to exceed $45,000 in annual wages.
  • Extends payroll credits for paid sick leave/paid family leave for COVID-19 expenses to 2021.

The new Pelosi bill also bails out her political allies, whether they be the cashed strapped, heavily indebted blue states like California, New York, and Illinois or cities like Baltimore, Los Angeles, and Philadelphia or her wealthy coterie of San Francisco sophisticates who probably also have freezers full of designer ice cream.

First off, she’s calling for $500 billion in funding to assist state governments with the fiscal impacts from the public health emergency caused by the coronavirus, followed by $375 billion in funding to assist local governments. Then she wants $20 billion to assist Tribal governments, $20 billion for the governments of the Territories, and an additional $755 million for the District of Columbia.

But the biggest kick of all is the two-year suspension — for 2020 and 2021 — of the elimination of the cap on the deductibility of state and local taxes on federal tax returns. That deduction, called SALT by the tax policy experts, helps ease the burden of living in high cost, high tax states like California while increasing the total burden of the federal budget sitting on the shoulders of low tax and no tax states like South Dakota, Texas, Tennessee, and Florida. To put it another way, it’s a way to get the red states to pay for the upgraded standard of living enjoyed by blue voters in blue states. (RELATED: Official Berates Elon Musk for Threatening to Leave California Over Lockdown)

Congress and President Donald Trump capped the deductibility of SALT in the Tax Cut and Job Acts, making everything fairer to all. Pelosi wants to undo that permanently, which is probably why her proposed suspension lasts two years — which she figures is enough time for a Biden administration to get repeal through a Democratic Congress. What’s especially galling is how no one is going to call her out on how she and her husband will personally benefit if the cap is lifted. The Pelosis stand to save a lot of money if the SALT cap comes off while many of the rest of us end up paying more. Didn’t she recently call a scheme like that where an elected official stood to profit personally from political action they’d proposed or undertaken an impeachable offense?

READ NEXT: Cashing in on the COVID Crisis >>

Advertisement
HELP Expose the TRUTH About Creepy Joe Biden

Peter Roff
Peter Roff
Peter Roff is affiliated with several Washington, D.C. public policy organizations and is a former U.S. News and World Report contributing editor who appears regularly as a commentator on the One America News network. He can be reached by email at [email protected] Follow him on Twitter @PeterRoff.

53 COMMENTS

People, Places & Things

- Advertisment -

Must Read

Reopening Schools Amid Coronavirus Becomes Social Emergency

2
The reopening of the US economy has begun. People are going back to work, small businesses are reopening and economists and politicos alike are...

TAKE OUR POLL