Executive Summary: The 2017 Trump Tax Law Was Skewed to the Rich, Expensive, and Failed to Deliver on Its Promises

Households with incomes in the top 1 percent will receive an average tax cut of more than $60,000 in 2025, compared to an average tax cut of less than $500 for households in the bottom 60 percent, according to the Tax Policy Center (TPC).1 As a share of after-tax income, tax cuts at the top — for both households in the top 1 percent and the top 5 percent — are more than triple the total value of t. [...] The Congressional Budget Office (CBO) estimated in 2018 that the 2017 law would cost $1.9 trillion over ten years,3 and recent estimates show that making the law’s temporary individual income and estate tax cuts permanent would cost another roughly $350 billion a year beginning in 2027.4 Together with the 2001 and 2003 tax cuts enacted under President Bush (most of which were made permanent in 201. [...] Revenue as a share of GDP has fallen from about 19.5 percent in the years immediately preceding the Bush tax cuts to just 16.3 percent in the years immediately following the Trump tax cuts, with revenues expected to rise to an annual average of 16.9 percent of GDP in 2018-2026 (excluding pandemic years), according to CBO. [...] This would mean reversing the regressive tilt of the 2017 law, raising more revenue, and correcting priorities to advance the interests of low- and moderate- income families across the country instead of those of wealthy shareholders. [...] • Top priorities for extending and expanding tax provisions in 2025 should be the Child Tax Credit, the Earned Income Tax Credit (EITC) for adults not raising children, and the enhanced premium tax credits for Affordable Care Act (ACA) marketplace coverage.