Money Talks: The Warren-Hegar Plan to Raise Taxes
Election Day is 10 days away and Texas voters still don’t know who MJ Hegar is — let alone her policy plans. The latter is a result of her deliberate evasiveness toward deep dives into policy. In fact, the Dallas Morning News pointed out today: “even though Hegar voted for Sen. Elizabeth Warren for president in the March primary, she lacks the Massachusetts liberal’s penchant for issuing detailed policy prescriptions. On her website, Hegar doesn’t specify how much financial assistance Congress should give individuals and small businesses as the pandemic continues, nor what to do to lower housing costs or make taxes fairer.” Time to hold her to account.
Today we look at: The Warren-Hegar Plan to Raise Taxes
MJ has echoed Elizabeth Warren’s call to raise the Social Security Payroll Tax. Warren’s plan would hike the payroll tax to as high as 14.8% and extend the tax to those drawing investment income, such as dividend checks and capital gains from stocks and assets (Tax Foundation). This increase on capital gains would be the largest tax increase on investment and saving in American history.
Under the Warren-Hegar Tax Plan, Americans would see their taxes increase by $1.89 trillion, and put more than 532,500 full-time equivalent jobs in jeopardy. For self-employed Texans who pay full FICA contributions – and whose income has been especially impacted by COVID – this type of tax hike, which siphons more of their wages for federal taxes, could not come at a worse time.
The second part of the Warren-Hegar Tax (Hike) Plan is rolling back the 2017 tax cuts – which let the average Texan keep more than $1,300 of their hard-earned paycheck. The 2017 Tax Cuts & Jobs Act also brought huge relief for small businesses thanks to its 20% deduction on business income for pass-throughs. The Federal Reserve Bank of Dallas recognized these cuts as a major generator of jobs and greater economic prosperity nationwide prior to COVID-19.
While MJ calls this relief a “tax scam,” the NFIB reports small businesses used these tax breaks to:
- Give pay raises
- Invest in needed infrastructure and equipment
- Hired new employees
- Paid down deb
Texans deserve to know how her radical policies and cheerful declarations of “Raise the income cap!” and “walk back the tax reform!” would affect families across the state.
How does MJ justify raising taxes on businesses and households?
BACKGROUND
Tax Reform Has Delivered Substantial Benefits To Texas Taxpayers And Job Creators
In Texas, The Tax Foundation Found That The Tax Cuts & Jobs Act Delivered An Average Tax Cut Of $1,324.56 In 2018. (“The Impact Of The Tax Cuts And Jobs Act By Congressional District,” Tax Foundation, 2018)
The Tax Foundation Also Found That Texas Added 18,128 Jobs In 2018. (“The Impact Of The Tax Cuts And Jobs Act By Congressional District,” Tax Foundation, 2018)
A 2019 Analysis From The Federal Reserve Bank Of Dallas Found That Texas “Was One Of The Top 10 States In Terms Of The Size Of The Average Tax Cut Relative To State-Level Income.” “The Tax Cuts and Jobs Act of 2017 (TCJA), signed into law on Dec. 22, 2017, extensively cut individual income and corporate taxes and is widely believed to have contributed to stronger economic activity nationally in 2018… Texas, realizing a tax cut of almost $1,400 per tax-filing household in 2018, was one of the top 10 states in terms of the size of the average tax cut relative to state-level income.” (Anil Kumar, “Texas Sees Job, Output Gains From 2018 U.S. Tax Cut,” Federal Reserve Bank Of Dallas, 2019)
MJ Hegar Will Vote to Raise Taxes on Individuals and Businesses
Hegar: “We’ve Got To Walk Back The Tax Reform – The Tax Scam. It Was Not A Middle-Class Miracle.” HEGAR: “You know, we’ve got to walk back the tax reform – the tax scam. It was not a middle-class miracle.” (MJ Hegar, Remarks At A Campaign Event, San Antonio, TX, 2/19/20)
Hegar: “I do think we need to bring taxes back to a place where people are paying
their fair share including corporations.” HEGAR: I do think we need to bring taxes back to a place where people are paying their fair share including corporations.” (MJ Hegar, Democratic Primary Runoff Debate, 6/620)
Biden Has Called For A 12.4% Payroll Tax On Wages Above $400,000, While Warren Has Called For A 14.8% Payroll Tax On Wages Above $250,000. (Garrett Watson and Colin Miller, “Analysis Of Democratic Presidential Candidate Payroll Tax Proposals,” Tax Foundation, 2/11/20)
According To A Tax Foundation Analysis, Biden’s Payroll Tax Hike Would Total $808 Billion Over A Ten-Year Period, While Warren’s Payroll Tax Hike Would Total $1.89 Trillion. (Garrett Watson and Colin Miller, “Analysis Of Democratic Presidential Candidate Payroll Tax Proposals,” Tax Foundation, 2/11/20)
According To A Tax Foundation Analysis, Biden’s Payroll Tax Hike Would Jeopardize 350,400 Full-Time Equivalent Jobs, While Warren’s Payroll Tax Hike Would Jeopardize 532,500 Full-Time Equivalent Jobs. (Garrett Watson and Colin Miller, “Analysis Of Democratic Presidential Candidate Payroll Tax Proposals,” Tax Foundation, 2/11/20)
