BOSTON (CBS) – The TV ads opposing or promoting President Biden’s $1.74 trillion Build Back Better bill have been hard to avoid lately.
One in frequent rotation depicts a wealthy guy lounging in his fancy home where he’s been “riding out the pandemic…Mr. New York millionaire,” the narrator calls him, mocking the stereotype for having to hire not one but two tutors for his kids. “Last few years he’d had it rough, but now things are looking up, a big fat tax cut perfect for the New York rich.” Next thing you know, Rich Uncle Pennybags is kicking back with a mock newspaper headline that reads: “Wealthy Americans May Get A Tax Cut 10 Times Bigger Than A Middle-Class Family In The Biden Social Spending Bill.”
Perhaps you’ve also seen the pro-Biden ads, including one claiming the bill is “paid for by making the ultra-wealthy pay the taxes they owe without raising taxes on any of us making under $400,000.”
So, what’s the truth?
According to the independent Tax Policy Center, the bill would initially give modest tax cuts to a wide range of low and moderate earners, while taking a bite out of the top one percent. But over time up to 30 percent of middle-class households would also pay slightly more in taxes.
And a House-approved easing of the Trump-era cap on the ability of folks in high-tax states like Massachusetts to deduct state and local taxes from their federal payments would indeed benefit the affluent, fueling attacks from the right and dividing the left. “We’ve got to demand that the wealthy start paying their fair share of taxes, not give them more tax breaks,” says Sen. Bernie Sanders (D-Vermont). Responds House Speaker Nancy Pelosi: “This isn’t about who gets a tax cut, it’s about which states get the revenue that they need in order to meet the needs of the people.”
Major changes to our tax system are always complicated and their true impact is hard to predict. It depends on a range of factors including timing, human behavior and what your definition is of a “tax.”
The bottom line – buyer beware when it comes to sweeping claims made in these TV ads.