Those who believe in higher taxes will finally get them though only to give the richest a break, writes Guardian columnist Emma Brockes
The last week of the year in New York was one of arctic chill, a giant penis mural and people calling in to radio shows to freak out about the Trump tax plan. All week, NPR (National Public Radio) has emitted an unremitting stream of low-level panic as New Yorkers try to come to terms with the massive tax overhaul which, for them and millions of other Americans, will almost certainly mean a higher tax bill next year.
It has been speculated that the Trump plan targets New York and California as retribution for voting against him, but that seems to give too much credit to the man. Irrespective, there is no question that they are among those hit hardest by Trump’s decision to limit interest deductions on mortgages above $750,000 (£555,000) and reduce deductions for state and local taxes, painfully high in New York, from federal tax returns. Meanwhile, corporate tax rates are being slashed and inheritance tax will eventually be phased out.
Many of these measures target what in America is labelled the “middle class”, an extremely broad bracket that covers almost everyone who isn’t a billionaire or a recipient of welfare, and a reminder of how differently that term plays in the US than in Britain. Middle class, in the US, is not a pejorative with the silent prefix “smug”, but a byword for your average working person – and they are scrambling to find loopholes.
In Sacramento, local news stations reported lines around the block outside the federal tax building as residents tried to pay their property taxes before the end of the year, and squeak in under 2017 rules. (Not so fast, said the IRS, warning taxpayers that this move wouldn’t be considered legitimate unless those taxes were also “assessed” in 2017). Accountants worked overtime advising clients to give generously to charity, or buy big-ticket items that might qualify for deductions before the end of the year.
Meanwhile, liberals who believe in higher taxes could only smile at the irony of their wish coming true, not as a measure to deepen investment in social services, but to give a tax break to the rich. Happy New Year.
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