President Donald Trump boasted in Michigan last month that he signed into law “massive tax cuts, the biggest in the history of our country.”
As Americans rush Monday to finish with their own tax filings, their judgment on Trump’s beloved tax cut bill is pretty clear: Most really don’t like it.
Multiple polls show a majority of Americans don’t think they got a tax cut at all — even though independent analyses show they did. And only about a third of the country approves of the legislation itself, the Tax Cuts and Jobs Act, passed by Congress at the end of 2017.
Experts weigh in:
“I think the two major developments on tax attitudes are that Republicans have lost the edge they once had as the party best able to handle taxes,” said Karlyn Bowman, who analyzes polling data at the American Enterprise Institute. “And Democrats seem to be making headway by hammering away at the rich not paying enough.”
One reason many Americans don't feel the tax cut: The most dramatic benefit was aimed at slashing the corporate tax rate. And many Democrats want to undo much of that cut.
“The Democrats really outmaneuvered the Republicans by convincing the American people that the main thrust of the tax reform package was to cut taxes for the wealthy,” said Dan Eberhart, a major Republican donor who runs the drilling services company Canary, LLC. Republicans “failed to fully explain the success to voters.”
Truckers were especially upset:
“They got screwed,” says Kevin Rutherford, a small-fleet owner who hosts Trucking Business and Beyond, a daily satellite radio show, and also runs an accounting service geared to drivers.
The 2017 Tax Cuts and Jobs Act got rid of all employee expense exemptions, and, in a bid to make filing simpler while offsetting that change, doubled the standard deduction for both single and married filers. But for truckers used to deducting upward of $15,000 based on the per diem rule, the larger standard deduction isn’t enough to make up the difference.
“This was the law of unintended consequences,” Rutherford says. “They just said, ‘Look, get rid of the employee deductions, we’ll double their standard [deduction], everybody will be happy.’ Except there are few employees taking deductions of $15,000 a year, and that’s the average per diem for a driver.”
“Most company drivers are worse off.”
Dennis Bridges, who runs an accounting firm just north of Atlanta, had to break bad news to a client.
“Even though your tax rate is lower, you’re having to pay that lower tax rate on a higher amount of taxable income,” says Bridges, who estimates that a third of the company drivers whose returns he prepared paid more taxes this year due to the loss of the per diem. Single drivers fared worse, thanks to big savings for married filers built into the tax bill. Bridges says “at least 75 percent” of his clients have faced an unexpectedly large tax bill. “Most company drivers are worse off now in the sense that they’re now having to somehow come up with money out of pocket.”