Republicans are happy about the tax cut for the wealthy, oh, and the small temporary tax cut for the middle class

The Republican slant on the Tax Cut and Jobs Act passed last month is that it is primarily a temporary tax cut for the middle class. The problem is that the temporary tax cut is minor and few families will actually notice any change. The temporary tax cut will be given in small increments on the paycheck, not a lump sum at the end of the year.

By The Numbers

So how much can a person expect to see their paycheck increase? Here are examples of the average temporary tax cuts those earning between $25,000 and $75,000 per year, paid every two weeks (NOTE: Total Tax Cut/paycheck is for each wage earner in a married family):  

(Source:  NYTimes Tax Cut Calculator)

Situation    Dependents   Ave. Tax Cut    Tax Cut/paycheck

Married                    2                     $1,420                     $27.31 ($54.62 total)

Married                    1                       $  970                      $18.65  ($37.31 total)

Single                        2                      $1,290                     $49.62

Single                        1                      $1,000                     $38.46

If you live in the   states (California, Connecticut, Massachusetts, New Jersey, New York and Washington, D.C.,) the tax cut is less:

Situation    Dependents   Ave. Tax Cut    Tax Cut/paycheck

Married                  2                       $  470                     $  9.04 ($18.08 total)

Married                  1                       $  370                     $  7.12 ($14.23 total)

Two to three trips to Starbucks every week* will wipe out the tax cut for most of the middle class.

Inflation Will Swallow At Least Half

Inflation is forecast to be at 2.3 percent for 2018. That means that for every $100 spent on groceries, gas, clothing, etc., the consumer will pay $2.30 more in 2018. If a person spends $30,000, the cost of living will increase by $690. That will wipe out almost half of the temporary tax cut for most of the middle class.

In the end, the only citizens that will notice a tax cut are major corporations and the wealthy. The middle-class citizen will mostly notice what they can no longer use as exemptions.

(*Assuming one $5.00 drink per visit x 6 times per paycheck)

What will the wealthy get back?

A family making over $750,000 could pay a middie class worker’s annual salary with their tax cut.

Situation    Dependents   Ave. Tax Cut    Tax Cut/paycheck

Married                   2                   $39,360                   $ 756.92  ($1,513.85 total)

Married                   1                   $34,050                   $ 654.81  ($1,309.62 total)