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When is a tax not a tax?

When it is called a tariff.

Republicans claim to be against Tax Increases. They attack anyone who they believe wants to raise taxes. And yet, they have ignored Trump’s tax increases. What increases? Donald Trump has, by executive fiat, levied taxes of up to 50% on goods being imported into the US, with the most common tariffs being 25%.

How does this differ from a tax? I can’t think of any substantiative difference. If you buy anything from China or other foreign nations, you will be pay what is basically a sales tax to the federal government. Can you imagine the uproar if the government levied a sales tax of 25% on mobile phones, televisions, washing machines, solar panels, and other goods? Well, they have basically done that, and are threatening to tax those things even more.

And here’s the really interesting point. Sales taxes (including tariffs) are mainly paid by the middle class. The 1% don’t need to buy more than one iPhone or one washing machine, the same as the working Americans. Not only do Trump’s tariffs fall disproportionately on poor and middle class Americans, they would hurt working Americans by reducing GDP, and cutting full time jobs by around 80,000.

On the other hand, the majority of the Republican Tax Cut at the end of 2017 benefitted the richest Americans and large corporations. After the tax cut was enacted, Treasury Secretary Steven Mnuchin claimed 90% of all working adults would see increases in their paychecks because of the cuts. But the it turned out to be that only 4.3% of workers saw a wage increase or even a one-time bonus because of the tax cut.

So the Republicans and Trump have given us a tax cut and a tax increase. Is anyone surprised that the tax cut went mainly to the rich, and the tax increase will be largely paid by working, middle-class Americans? Remember this the next time the Republicans claim to be against tax increases. They are against tax increases only for themselves.



This post first appeared on Political Irony, please read the originial post: here

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When is a tax not a tax?

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