Economy Jake Johnson Politics

$285 Billion Tax Cut for the Rich Is Now 2nd Most Expensive Piece of Build Back Better

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By Jake Johnson / Common Dreams

A $285 billion tax cut that would predominantly flow to rich households is now the second most expensive component of the Build Back Better Act after corporate Democrats succeeded in slashing funding for a number of key progressive priorities—and removing other programs entirely.

With the House of Representatives preparing to vote later this week on the roughly $1.8 trillion reconciliation package, the Washington Post reported Tuesday that Democrats’ plan to raise the cap on state and local tax (SALT) deductions from $10,000 to $80,000 through 2026 would be “more costly than establishing a paid family and medical leave program, and nearly twice as expensive as funding home-medical services for the elderly and disabled.”

“Over the next five years, raising the SALT cap would provide a tax cut only to those who itemize their taxes and pay more than $10,000 in state and local taxes—a group overwhelmingly made up of the wealthy,” the Post noted. “A recent analysis from the Tax Policy Center says the tax cut will benefit primarily the top 10% of income earners, with almost nothing flowing to middle- and lower-income families.”

The only part of the Build Back Better package that’s currently larger than the proposed SALT cap increase is the legislation’s universal pre-K and affordable child care programs, both of which progressive critics warn are deeply flawed and have been pared back in recent weeks to appease right-wing Democrats.

“As the Build Back Better bill makes its way through Congress, significant changes are being made to the various proposals, generally for the worse,” Matt Bruenig of the People’s Policy Project noted last week. “Hollowed-out versions of older proposals are limping to the finish line and it’s a completely different bill at this point.”

The proposal to lift the SALT cap—which was created by the GOP’s 2017 tax law—was added to the reconciliation package largely at the behest of a small group of corporate Democrats who threatened to tank any bill that omitted an increase.

“No SALT, no deal,” Rep. Tom Suozzi (D-N.Y.) said in a recent statement, a message that other right-wing Democrats readily echoed.

Last month, after President Joe Biden privately floated leaving SALT changes out of the reconciliation package, Senate Majority Leader Chuck Schumer (D-N.Y.) reportedly intervened to rescue the tax break, which one analysis estimates will deliver an average tax cut of $16,760 to U.S. millionaires.

Outraged by the SALT proposal’s regressivity, Sen. Bernie Sanders (I-Vt.) told reporters on Tuesday that he’s currently working on a compromise plan that would limit the provision’s benefits for the wealthy.

“I am working with some of my colleagues to make sure that we come up with a proposal that protects the middle class, but does not end up with an overall reconciliation bill in which millionaires are better off tax-wise than they were under [former President Donald] Trump,” said Sanders, the chair of the Senate Budget Committee.

Progressives have also raised alarm over the political toxicity of handing rich households a major tax cut in a bill that’s ostensibly dedicated to combating the climate crisis, improving the nation’s tattered social safety net, and finally making the wealthy pay their fair share.

“After Democrats gutted their wildly popular initiatives to expand Medicare and lower drug prices, the tax initiative has now become one of the most expensive provisions in the entire Build Back Better legislation,” The Daily Poster‘s David Sirota wrote Tuesday. “The whole initiative seems deliberately sculpted to hand the American right a weapon to bludgeon Democrats ahead of the election.”

Right-wing groups are already attempting to do just that. On Tuesday, Heritage Action announced a $1.25 million ad buy targeting Reps. Carolyn Bourdeaux (D-Ga.), Cindy Axne (D-Iowa), Jared Golden (D-Maine), Elissa Slotkin (D-Mich.), and Susie Lee (D-Nev.) over the SALT provision.

“Their latest plan is to give $200 billion in blue state bailouts to their rich friends at the expense of all other Americans,” declares the ad, which will run on television and online.

Watch the spot focused on Congressman Golden and aimed at Maine voters:

In an email on Tuesday, the Patriotic Millionaires—a group that supports higher taxes on the rich—argued that “the last people who need government assistance right now are the well-off taxpayers who would be most affected by” the SALT cap change.

“Wealthy Americans already have so many advantages over everyone else—it is high time that we pay more, not less, in taxes,” the group wrote. “This choice isn’t happening in a vacuum. Democrats have already cut trillions of dollars of vital aid for American families from their reconciliation plan. Adding a significant tax cut for the wealthiest Americans on top of this would be adding insult to injury.”


  1. I don’t have a six figure income and since Trump’s tax law passed have been paying an additional $4K/yr in Fed income taxes. I suppose it makes me a billionaire to want to have the SALT deduction restored so I can put that money back in my pocket.

    1. Wow! How is that even possible? You must have fallen through a very narrow Crack. You make less than 6 figures and you’re paying 4K more in taxes?

  2. First Bernie Sanders said that he wanted a $10 trillion bill. Then he agreed to $6.5 trillion. Then the corporatists whittled it down to $3.5 trillion, and again down to $1.75 trillion. The corporatists have said all along, no SALT, no deal.

    The Squad said no climate, no deal. The Squad also said they wouldn’t vote for the horrible right wing Infrastructure bill unless the Reconciliation bill first passed the Senate. The Squad reneged on both of those hollow threats.

    Everything substantial and good has been stripped out of the Reconciliation bill, and now it includes a big tax break for the rich. Meanwhile, not only is the infrastructure bill a giveaway to construction companies and developers to do environmentally harmful work, but it contains massive theft of our public assets, euphemized as “privatization.”

    Conclusion: There is no one in government fighting for the environment or regular people, and I mean NO ONE. Not the Squad, not anyone. Electoral politics in this country is useless and meaningless except possibly on a very local level like cities and school boards, though even there the corporations and their rich owners usually get their way. Unless the U.S. electoral system undergoes radical changes like proportional representation and prohibition of all private campaign financing, the only way to get any substantial and real change will be in the streets.

    1. This seems to be the realization that many, many more people are coming to, finally, hopefully. In the meantime, the Dem Party sends me 2 dozen emails a week, asking for money (!) so ‘we” can elect more Democrats! Not a word on fighting for anything. The Republicans also send me about 2 dozen emails a week, asking for money (!) so they can fight the Socialist and Marxist schemes of the Democrats. We’ll have a full-on fascist House and Senate by 2023, and our idiot President will be getting impeached by his “good friends” the Republicans. All’s Cracker Joe ever wants is “bipartisanship” and a “strong Republican Party,” and that’s what he’s going to get.

    2. So obvious to anyone with eyes to see. It is truly a mark of the power of mass propaganda that to this day so few seem to understand or see that which is right smack in front of them. Illusion and delusion indeed appear more powerful then reality itself.

  3. It bears repeating: Democrats and Republicans serve the same masters, namely Wall St and what is still justifiably called the military-industrial complex. The US is doomed; get out while you still can.

    There’s a handful of countries in Europe, Scandinavia and Asia (e.g. the Netherlands, Germany, South Korea) that I think of as tiny rocky outcroppings that are still a few inches above the lava. Twenty years from now, they will have subsided into the molten stone of capitalism and despotism as well. Thank god I won’t live that long.

    I guess it was nice while it lasted. For some.

  4. Look, we need a real workers party that will only represent the majority in this country, not the 10%, not the 1%, not the .1%. The Republicans and Democrats do that nicely, so this ‘two party’ faux democracy actually needs a serious refresh. The labor movement, community organizations, youth and leftist groups could restart an aggressive class struggle – and not be its victim again and again and again. A Labor-Populist party could actually put these corporate royalists out of business.

  5. In New Jersey, where I live, property taxes regularly exceed $10,000 per year on modest, middle-class homes. It is deceptive to write that the SALT deduction primarily benefits the wealthy. Its main impact is geographic: those who live in high property tax states lose out when the SALT deduction is capped. There’s an argument to be made for capping it, but to position it as something that only benefits “the wealthy” is deceptive. The correlation to income is also deceptive, as the cost of living in certain states is significantly higher than in other states. In many states, a teacher and a nurse will have a combined income over $100k, but that hardly makes them “wealthy” considering the housing and other living costs in certain states.

    1. The vast majority of the benefits to go the top 10%. Whether some middle class people might benefit from its removal is minor in comparison, just like the fact that a small minority of people were helped by Obamacare, while the large majority saw our healthcare costs greatly increase. Middle class people would benefit far more from things like single-payer health care and free college.

      Americans pay very low taxes compared to people in western Europe, but Americans complain far more about paying taxes. Aside from the selfish individualism of Americans, the other reason is that Europeans actually get something for their taxes, like a good social safety net and free college (most countries). Complaining about taxes is a wealthy person’s complaint, a complaint of selfish people who don’t care about others or their society, and/or a complaint of people who get nothing for their taxes but maintenance of their empire by the military/intelligence/industrial complex.

      And BTW, how much do you make that you consider yourself “middle class”? I’ve heard many rich people call themselves middle class. While it’s true that they’re not ruling class, they ARE rich and are certainly not middle class.

  6. Could have sworn these were the people who were going to PAY for BBB. Does this mean it just goes on the plastic like everything else since the hard right turn of 1980?

  7. what does standard of living mean? most obesity? no universal health care, no mandatory paid maternity leave no state paid university education? all European nations except UK/Ireland have this–nerly all nations in Western Hemisphere have universal health—most state paid maternity leave, even Mexico has state paid univ education…US enjoys most violent crime, non-violent crime rape per capita (fewer than 25% reported per experts)

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