Taxes

Treasury Removes Study That Blows Up Tax Cut Magic

JM Ashby
Written by JM Ashby

Congressional Republicans and the Trump regime say passing massive tax cuts for corporations will trickle down to the little people who work for corporations.

There's virtually no reason to think that will happen as it has never happened in the past and, moreover, the Treasury commissioned a study in 2012 that found employees cover approximately 18 percent of the cost of corporate taxes.

But Treasury Secretary Steve Mnuchin says employees actually cover 70 percent of the cost of corporate taxes and the Treasury study from 2012 has been disappeared.

From the Wall Street Journal:

The 2012 paper from the Office of Tax Analysis found that workers pay 18% of the corporate tax while owners of capital pay 82%. That is a breakdown in line with many economists’ views and close to estimates from the nonpartisan Joint Committee on Taxation and Congressional Budget Office.

The JCT, which will evaluate tax bills in Congress, estimates that capital bears 75% of the long-run corporate-tax burden, with labor paying the rest. [...]

Asked about the paper’s disappearance, a Treasury spokeswoman responded Thursday: “The paper was a dated staff analysis from the previous administration. It does not represent our current thinking and analysis.

In her response, she said that “studies show that 70% of the tax burden falls on American workers” and that a “lower corporate rate, as proposed in the [GOP tax] framework, will generate the incentives needed to increase productivity and wages, as well as create jobs.”

"It does not represent our current thinking."

This isn't funny but, at the same time, I couldn't help but laugh my goddamn ass off at the claim that "studies show" workers cover most of the cost of corporate taxes after deleting a study that literally says the opposite.

This isn't a matter of political perspective or "current thinking," it's mathematics. It's empirical reality and evidence versus magical thinking.

  • muselet

    The Rs rely on the memory hole a lot, don’t they? The GW Bush administration did the same thing to inconvenient reports, I seem to recall.

    –alopecia

  • Badgerite

    This is just plain theft. Draining the public treasury into the pockets of themselves and their donors. It most assuredly will not “pay for itself”. The Reagan tax cuts didn’t. The Bush tax cuts, both Bush I and Bush II, didn’t. And these won’t.
    And it is targeted to the upper income levels at the expense of the middle and lower incomes where the overwhelming majority of the country lives. So how, exactly, does it “stimulate” the economy?

    • Economists have been saying this for years and they never, ever listen.

      • Badgerite

        That probably is because their objective is not to stimulate the economy.
        A 3 % growth rate is actually quite good. A 6% rate or whatever pie in the sky they are touting this week would probably set off a round of price inflation and the Fed would probably slam on the brakes with a interest rate hike. So this is really nonsense. Ergo the real purpose has to be 1) to drain all the revenues away from government programs and regulatory oversight , 2) into the pockets of the GOP large donor base and 3) leave the federal government and any oversight of private industry or 1% power crippled for a generation to come. With that kind of power and nothing to restrain it, these people plan to entrench themselves into lives of privilege and power at the expense of the everyone else in society and for as long as they can. It makes no sense any other way. This is very cynical and corrupt.

        • I wholeheartedly agree. This is a power grab by the 1% and anyone who voted for the Twerp in Chief only have themselves to blame.

        • Christopher Foxx

          these people plan to entrench themselves into lives of privilege and power

          Into???

          These people already live lives of extreme privileged and power. Which is another reason why there is no word to accurately describe their need to destroy the middle class and majority of Americans other than sociopathic.

    • ninjaf

      It doesn’t, but they have a conservative propaganda machine across all media that says otherwise, so I guess that makes it truthy enough for them.

  • In Wingnuttistan 1 + 1 = 3 and sh*t only rolls uphill.