In an op-ed recently published in National Review, “Careless Tax Reform Could Destroy a Lifeline for the Poor,” Philanthropy Roundtable Visiting Fellow Jack Salmon discusses the potential disastrous implications for the most vulnerable in our communities if Congress does not extend the 2017 Tax Cuts and Jobs Act (TCJA) set to expire later this year.
Below are excerpts from “Careless Tax Reform Could Destroy a Lifeline for the Poor”:
“With key provisions of the 2017 Tax Cuts and Jobs Act (TCJA) set to expire at the end of this year, Washington is debating tax reform behind closed doors, and their decisions will reverberate through every corner of American life. If tax reform isn’t approached thoughtfully, the impact on those already facing significant challenges could be disastrous.
“Higher taxes don’t just “eat the rich,” contrary to what we hear so often. They have an outsized meaning in the lives of ordinary people. They shape the resources available for families to meet basic needs, and the generosity of individuals to fund the charities that fill in the gaps. While some are shouting about cuts to federal aid programs, the real bogeyman looms large: When tax policy stifles economic growth or makes financial giving harder, the poor lose — first and hardest.
“Consider the TCJA’s near-doubling of the standard deduction and the lowering of individual rates. If that lapses, millions will find themselves filling out more paperwork to hand over a larger slice of their income to Uncle Sam. For struggling households, this means less money for rent, groceries, and medical bills, the costs of which have skyrocketed in recent years. It’d be a direct hit to the financial stability of the most vulnerable, and would further strangle their ability to improve their family’s prosperity.”
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“As lawmakers continue crafting the next tax package and how to pay for it, they must not turn philanthropy into Washington’s piggy bank. Targeting charitable donors risks turning America’s safety net into collateral damage for the sake of a policy experiment. There’s a better path: Congress could simplify the tax code, lower rates, or phase out subsidies that distort the market — all without undermining the charitable sector.”
Please continue reading at National Review.
