January 28, 2023
Under the leadership of President Biden and Democrats in Congress, our economy has experienced a remarkable recovery since the start of the COVID-19 pandemic nearly three years ago. National GDP continues to grow at a rapid pace, and unemployment stands at a 50-year low, thanks to the creation of nearly 11 million new jobs—the strongest two years of job growth in American history. Annual inflation has fallen in each of the past six months, helping to enable a record increase in small business applications—with 10.5 million new businesses created in just two years. This undeniable, extraordinary progress has raised wages, cut costs, and created jobs for countless working families.
The evidence that Democratic policies continue to boost the economic fortunes of everyday Americans is overwhelming. But instead of celebrating these gains and working to maintain our momentum, Congressional Republicans are already working toward policies that would roll back our progress and reward their wealthiest supporters.
Earlier this month, House Republicans used their first day in the majority to introduce a bill that would make it easier for the wealthiest Americans to avoid paying their fair share of taxes, all while eviscerating the IRS’ ability to provide timely, effective customer service to working families. Not only would this bill add $114 billion to the federal budget deficit by enabling billionaire tax cheats to dodge their obligations, it would also prevent everyday Americans from receiving their hard-earned refunds from the IRS. By cutting off funding for under-resourced agency employees while gutting tax enforcement efforts, this bill takes from hardworking families to fill the pockets of the one percent.
This legislation is not the only effort by the House GOP to boost their billionaire backers at the expense of everyday Americans. As a result of a side deal that helped buy him the speakership, Kevin McCarthy has agreed to a vote on the so-called “Fair Tax Act.” This bill, backed by members of the far-right Freedom Caucus, would completely eliminate the federal income tax, replacing it with a 23% federal sales tax on almost all goods and services, from groceries to gasoline.
Experts across the ideological spectrum agree that this proposal would slash taxes for the wealthy while dramatically raising them for working families. Seniors, families with children, and low-income workers would be especially hard-hit. Under this half-baked plan, everyday Americans who need to spend most or all of their paycheck each month would be faced with devastating price hikes of up to 30% on their basic expenses. Meanwhile, people making millions of dollars a year would see six-figure tax cuts.
Republicans’ proposed tax hike on the middle class represents an unconscionable transfer of wealth from working families to millionaires and billionaires, and the GOP’s brazen brinksmanship over the federal debt limit only further underscores their economic recklessness.
Last week, we reached the debt ceiling, prompting Treasury Secretary Janet Yellen to take “extraordinary measures” to stave off a default. President Biden and Congressional Democrats have made it clear: Congress must raise the debt ceiling without conditions to allow our nation to pay its bills and avoid defaulting. Experts and business leaders continue to warn that a default would set off a chain reaction of negative economic effects that could plunge the global economy into a deep recession.
But despite these dire consequences, Congressional Republicans continue to hold the U.S. economy hostage to their extreme demands for drastic spending cuts to popular and vital programs like Medicare, Medicaid, and Social Security. This GOP flirtation with disaster puts every federal program at risk, from veterans’ benefits and consumer protection efforts to funding for scientific and medical research. The full faith and credit of the United States must never be up for negotiation. Congress must put its responsibility to the American people over partisan disagreements and pass a debt limit increase before it’s too late.
The past two years have seen a remarkable economic turnaround under President Biden’s leadership. With wages on the rise and consumer costs decreasing by the day, Democrats have placed our economy and the fortunes of working families on a strong foundation. We will not allow Republicans to undermine that foundation by enriching their wealthiest backers, raising costs for everyday Americans, and risking a catastrophic debt default in order to slash funding for essential social programs. I’ll always continue my efforts to deliver real economic security for American families.
As always, thank you for reading.
DID YOU KNOW?
My office and I are working to make sure you remain informed with the latest updates and recommendations from federal agencies. With that in mind, here is some information that may be of interest to you:
- With tax season approaching, I will be hosting a virtual 2023 Tax Season Forum on Monday, January 30th from 5:00 PM to 6:00 PM.
- Representatives from the IRS, the Taxpayer Advocate Service, and the Greater Capital Region CA$H Coalition will be on hand to answer your questions and to share information, updates, and resources for this year’s federal tax filing season.
- The event will be streamed live HERE on my Facebook page.
- Following the conclusion of the event, a video recording of the forum will be available at the above link to view at your convenience.
- Do you have a tax question that you’d like to see addressed during the forum?
- Please contact my Albany office at (518) 465-0700 or find me on Twitter, Instagram, or Facebook at @RepPaulTonko to submit your question.
- Additionally, filing assistance and answers to frequently asked questions are available at IRS.gov.
- In addition to IRS.gov, the IRS has a variety of other free options available to help taxpayers, including free assistance at Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) locations nationwide.
- The IRS is also offering the IRS Free File program, a safe, easy, and free portal to submit your returns.