Biden Seeks to Reverse 2017 Tax Cuts Despite Revenue Gains

President Biden seeks to let 2017 tax rate cuts expire, despite data showing individual income tax revenue increased by $600 billion per year since implementation. The tax cuts benefited Americans across all income levels, with the bottom half paying an average income tax rate of 3.3% in 2021.

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Nitish Verma
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Biden Seeks to Reverse 2017 Tax Cuts Despite Revenue Gains

Biden Seeks to Reverse 2017 Tax Cuts Despite Revenue Gains

President Biden is pushing to let the 2017 tax rate cuts expire, which were passed by President Trump and Republicans without Democrat support. However, data shows that individual income tax revenue has increased by $600 billion per year since the tax cuts were implemented, with all taxpayers benefiting, not just the rich.

Why this matters: The decision to reverse or maintain the 2017 tax cuts has significant implications for the economy, as it can affect the government's revenue and the people's purchasing power. It also raises questions about the role of government in redistributing wealth and the impact of taxation on economic growth.

Before the tax rates cuts in fiscal year 2017, individual income tax revenue was $1.6 trillion. Four years later in fiscal year 2021, that figure jumped to $2.0 trillion, a $400 billion annual increase. By fiscal year 2023, six years post-tax cuts, individual income tax revenue reached $2.2 trillion, representing a staggering $600 billion increase per year compared to pre-cut levels.

Despite these revenue gains, President Biden and others claim that the tax cuts "cost" the government $2 trillion and increased the debt and deficit. However, this assertion is merely a prediction, not a fact supported by the data. The numbers clearly show that the government has collected substantially more revenue in the years following the tax cuts. Increased revenues do not cause rising debt—the real culprit is elevated government spending.

According to the Tax Foundation, the tax rate cuts benefited Americans across all income levels in 2021. The bottom half of taxpayers, earning under $46,637, paid an average income tax rate of just 3.3 percent. Those in the 10th to 5th percentiles, with adjusted gross incomes between $169,800 and $252,840, faced an average rate of 14.3 percent, four times that of the bottom half. The top 1 percent, earning $682,577 and above, paid the highest average rate at 25.93 percent, nearly eight times the rate of the bottom 50 percent.

The public deserves to know the truth about the impacts of the 2017 tax rate cuts rather than being misled by political rhetoric. Raising tax rates now would siphon more money away from voters and concentrate power in the hands of the government. Instead, allowing citizens to keep more of their hard-earned income to spend, save, and invest as they see fit will spur economic growth and prosperity for all.

Key Takeaways

  • Individual income tax revenue increased by $600 billion/year since 2017 tax cuts.
  • Tax cuts benefited all taxpayers, not just the rich, with lower rates across income levels.
  • Government revenue increased, contradicting claims that tax cuts "cost" the government $2 trillion.
  • Elevated government spending, not tax cuts, causes rising debt and deficit.
  • Allowing citizens to keep more income spurs economic growth and prosperity, rather than raising tax rates.