202-224-4515, Katie Niederee and Julia Lawless
Myth v. Fact: Setting the Record Straight on Democrats’ Tall Tales
No, the Senate Tax Plan Does Not Kick Thousands off Their Health Care or Give Tax Breaks to Private Jet Owners
Myth: The Senate tax plan gives tax breaks to private jet owners.
Fact: The Senate tax plan includes a provision, which was introduced as a standalone bill by Sen. Sherrod Brown (D-Ohio), to correct a long-running dispute between the IRS and private plane owners and operators.
For years, the IRS has been in dispute with private plane owners over a federal excise tax. Generally, passenger transportation costs, like the price of a ticket for a commercial airline, are subject to what is called the ticket tax. There has been recent uncertainty whether this tax should apply to aircraft owners for management services when they use their own aircraft. There have been a number of lawsuits, but in the end, it has not been clearly established that the ticket tax applies to amounts paid by aircraft owners or lessors for management services of their own aircraft. All this provision does is cement in law that the IRS cannot apply the ticket tax to amounts paid for management services concerning an owners or lessors use of their own aircraft. Earlier this Congress, Sen. Brown introduced a standalone version of this bill, which has received bipartisan support. The Joint Committee on Taxation (JCT) said this provision will amount to less than $50,000 per year—as much as a rounding error in the federal budget.
In fact, The Washington Post’s Fact Checker gave Democrats four Pinocchios for this claim.
Myth: Handwritten changes on the bill mean the Senate tax plan was rushed and done in secret.
Fact: As Finance Committee Member Sen. John Cornyn (R-Texas) said on the Senate floor: “Our Democratic colleagues acted like this is the first time this had ever been done,” when it, in fact, “Forty-six Senate Democrats voted for Senator Durbin's amendment which included these handwritten changes in the text.”
Members of both parties have, from time to time, made handwritten changes to bill text. For example, Sen. Durbin introduced an amendment to the Dodd-Frank legislation in 2010 which included handwritten changes—46 Democrats voted aye. It’s not unusual for handwritten changes to be made to legislation prior to a vote. Indeed, there were numerous instances of handwritten changes to legislative text when the Democrats processed their Dodd-Frank bill.
Myth: Thousands of people will die because Republicans are taking away health insurance.
Fact: No one is getting kicked off their health insurance. The only change the Senate tax plan makes to the healthcare system is repeal of the Obamacare individual mandate tax.
The individual mandate tax is a regressive tax that punishes poor Americans if they do not purchase health insurance that they do not want or cannot afford. The bill does not touch the availability of premium tax credits or Medicaid. Anyone who likes their health insurance plan is not prohibited from purchasing it. And, JCT backs this up. At the Finance Committee markup of the bill, JCT’s chief of staff said, “There’s nothing that mandates that people give up insurance. It’s an economic decision.”
JCT also confirmed that the bill: has, “no provision related to Medicaid;” makes “[n]o changes in terms of Medicare;” And does not disqualify anyone from either program.
Myth: The Senate tax bill raises taxes on the working class.
Fact: The Senate tax bill will lower the tax bills of millions of working class Americans.
By nearly doubling the standard deduction, lowering rates across the board and doubling the child tax credit, the Senate tax reform plan will lower taxes for every income group, including working-class Americans. The Senate tax plan was written with working families in mind, and the legislation reflects that goal. In fact, the typical family of four will see their tax bill go down by $2,200.
Myth: This bill is just a big give away to corporations.
Fact: Lowering the corporate tax rate and moving to a territorial tax system will put America in line with its global competitors, bringing jobs and investment home.
Leaders on both sides of the aisle, including former Presidents Obama and Clinton, have supported lowering the corporate tax rate, so the United States can compete in today’s global economy. Currently, our corporate tax rate is one of the highest in the industrialized world at a whopping 39 percent. Lowering our corporate rate, so it is in line with our global competitors, will bring investment and jobs home, and is a policy that has been supported by both sides of the aisle.
Lowering the corporate rate will also boost wages, putting more money in the pockets of working Americans.
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