According to Minnesota Rep. Erik Paulsen (R), an “average family of four in the Third District” could see “[close] to a $5,000 tax cut” thanks to the GOP’s 2017 tax bill. But Democratic challenger Dean Phillips says that because state and local tax deductions are capped at just $10,000, the tax bill will actually cause residents of the Third Congressional District to lose money.
The fact that residents of Paulsen’s own district will lose money is “a big deal,” said Phillips. “And I believed that begged particular consideration from Erik Paulsen that wasn’t afforded this bill.”
Republicans touted the tax bill before its passage last year, claiming that the corporate savings it would create would spur job creation and increased spending on workers.
The GOP was right, at first. At least 300 companies announced bonuses or pay raises after the tax bill slashed the corporate tax rate from 35 percent to 21 percent.
But last month, a survey of Morgan Stanley analysts found that only 13 percent of the savings companies are collecting is expected to go to workers in the form of raises, benefits, or bonuses. Investors are expected to reap a far larger portion of the savings － 43 percent － in the form of stock buybacks and dividends.
After an event Phillips hosted last month at the Westonka Library in Mound, he said that while no one mentioned the tax bill, “It comes up regularly. I was surprised it didn’t come up today.”
Like many of Paulsen’s decisions, his support for the tax bill has been problematic in the moderate Third Congressional District. In an interview with MPR News, Mound resident Pieter Maas said that while he’s voted for Paulsen in the past two elections, he is unhappy with Paulsen’s support for the tax bill and said he might not support the congressman again.
“It sounds like the upper echelon of people that have money will just basically gain more money and the fact that they’re talking about maybe trickle-down effects or something like that, it always seems like the person at the bottom doesn’t get as much rain as they think he should get,” said Maas.
Another of Paulsen’s Democratic challengers, Adam Jennings, is also campaigning against the tax bill. “It goes against everything that Erik Paulsen has ever stood for,” said Jennings. “It makes taxes go up on a number of middle-class families. It makes the deficit go up by, best case scenario, $1.5 trillion over the next ten years.”
Even if Paulsen is right that the average family of four in the Third Congressional District will see a $5,000 windfall this year, the terms of the bill mean that by 2027, 53 percent of Americans will pay more in taxes than they otherwise would have.
Featured image via YouTube.