Working Families Left Holding the Bag for Billionaire Tax Breaks, Says Groundwork’s Owens
Today, House Republicans passed President Trump’s tax bill, which would raise the cost of living for American families by drastically cutting Medicare, Medicaid, food assistance, and other basic needs programs — all so billionaires and large corporations can pay less in taxes.
Groundwork Collaborative’s Executive Director Lindsay Owens reacted with the following statement:
“Today, House Republicans decided that giving massive tax breaks to billionaires is more important than lowering costs for hardworking Americans. The legislation cuts Medicare by $500 billion; kicks over 16 million Americans off of their health coverage; and makes groceries, utility bills, and higher education more expensive.
“Americans voted for lower costs, and instead, they’re holding the bag for billionaire tax breaks.”
BACKGROUND
An analysis by Groundwork Collaborative found that the GOP tax bill will increase costs for working families in over a dozen ways:
1. Increasing Health Care Expenses: The proposed Medicaid cuts would kick 10.3 million people off Medicaid by 2034 and cause 7.6 million people to become uninsured. Other changes to the Affordable Care Act would completely kick another 6.1 million Americans off their insurance and raise annual premiums by roughly $625 for those staying on Marketplace coverage – spiking average premiums to nearly $1,300.
2. Increasing Grocery Bills: As American families already struggle to afford groceries, Republicans are working overtime to introduce burdensome paperwork requirements that could reduce or eliminate Supplemental Assistance Nutrition Program (SNAP) benefits for nearly 11 million Americans. Currently, the average SNAP recipient gets $187 per month, and a household of four can receive up to $975.
3. Making College Education More Expensive: Republicans’ proposal to limit eligibility for Pell Grants will result in 1.4 million students losing their benefits and reduced benefits for an additional 3 million. The maximum annual Pell Grant award is $7,395 per year. Students pursuing a bachelor’s degree could have to pay an additional $29,580 for a degree if they lose eligibility for the grant.
4. Raising the Cost of Student Loans: The bill eliminates federal Direct Subsidized student loans, which do not accrue interest while undergraduate students are in school. Over four years, a student could have to pay up to $2,873 in additional interest alone. The bill also eliminates multiple income-based student loan programs that helped borrowers to repay their loans, such as SAVE and PAYE. Borrowers would have to pay 15 percent of their income (up from 10 percent) and a typical family of four would have to pay an additional $4,786 per year.
5. Increasing Tax Filing Costs: The IRS Direct File program provided a free, simplified way for taxpayers to file their federal taxes online – cutting out the need for costly software or paid preparers. Republicans are proposing to end the program, which would cost the average taxpayer up to $160 each year on filing services and lost time. Additionally, low-income families could lose out on up to $12 billion in tax credits each year from not filing their taxes.
6. Allowing Price Hikes Based on Private Data: The bill includes a 10-year ban on state governments passing new regulations on AI technology, giving companies a free pass to continue gouging customers based on their private information.
7. Raising Utility Bills: Republicans want a nearly full repeal of the clean electricity tax credits, which incentivize utility companies to make new investments and diversify their grids. This will likely raise the average family’s electricity costs by roughly $400.
8. Increasing the Cost of Home Energy Efficiency Improvements: As utility bills rise, making your home more energy efficient would help lower costs – but Republicans want to make that more expensive too. The House bill terminates residential clean energy credit, which saved families an average of $2,230 on solar panels in 2023. It also ends the energy efficient home improvement credit, which provided up to $3,200 in tax credits for taxpayers who made energy efficiency improvements to their homes, like installing electric heat pumps and Energy Star-certified windows. Currently, leveraging these two credits can save consumers up more than $2,200 in energy costs each year.
9. Increasing the Cost of a New Home: Republicans want to abolish the New Energy Efficient Home Credit, which incentivized the construction of energy efficient homes and was estimated to spur the construction of 3 million homes in the next few years. Now, builders that were expecting the credit will likely pass the cost on to consumers or cancel the construction of new homes altogether, further disrupting the housing supply and increasing costs.
10. Raising Gas Prices: By 2035, the price of gasoline would rise by up to 37 cents per gallon because of the proposed termination of electric vehicle (EV) affordability programs, tailpipe emission standards, and fuel economy standards.
11. Increasing the Cost of a New Car: Republicans want to terminate the $7,500 tax credit for purchase of new EVs ($4,000 for buying a used EV). On top of increased vehicle costs, Americans could also miss out on up to $2,200 in annual savings on fuel expenses. Republicans have further proposed a new annual fee of $250 for EV owners and $100 for hybrid owners.
12. Increasing Commuting Costs: Republicans want to permanently terminate the $20 monthly pre-tax benefit for those who commute with a bicycle. Pair this with the termination of the EV credit, and there’s no good way to escape from increased fuel costs.
13. Raising Costs for Parents: Republicans are proposing taking the Child Tax Credit away from the parents of children if both parents are not citizens or legal permanent residents. This would deprive the parents of 4.5 million children of the $2,500 credit meant to help parents offset the costs of raising children.