Tuesday January 21, 2020
Home Lead Story US Taxpayers ...

US Taxpayers Unhappy With Trump’s Tax Cuts

About five percent of taxpayers — 7.5 million people — will in fact see a tax increase.

0
//
Tax payers, Trump
FILE- This July 24, 2018, photo shows a portion of the 1040 U.S. Individual Income Tax Return form for 2018 in New York. VOA

Some taxpayers are getting a bitter surprise this year as their usual annual tax refunds have shrunk — or turned into tax bills — even though President Donald Trump loudly promised them largest tax cut “in American history.”

And with tax season under way, thousands of unhappy taxpayers have been venting their displeasure on Twitter, using hashtags like #GOPTaxscam, and some threatened not to vote for Trump again.

“Lowest refund I have ever had and I am 50 yrs old. No wall and now this tax reform sucks too!!” a woman going by “Speziale-Matheny” wrote from the crucial political swing state of Florida. “Starting to doubt Trump. I voted for him and trusted him too.”

During the year, American wage earners see a portion of each paycheck withheld as income tax, and many then receive a refund the following year if they have overpaid the federal government. That cash boost is eagerly awaited each year, and used to help pay off debt or make large purchases.

But the 2017 tax overhaul — which Republicans promoted as a boon to the middle class — meant many workers paid less in taxes during the year reducing the amount withheld, a change which may have gone unnoticed.

US, Trump
FILE – A worker adds federal tax filing information to shelves at the Eudora Welty Library in Jackson, Miss., Feb. 15, 2018. VOA

And the reform also cut some popular deductions, sometimes resulting in thinner refunds or even unexpected tax bills.

Early data from the U.S. Internal Revenue Service show that refunds so far this year are 8.4 percent lower than 2018 payouts on average, falling to $1,865 from $2,035.

However, many millions more taxpayers will be filing tax returns by the annual April 15 deadline, meaning this figure could change.

Mark Mazur, assistant Treasury secretary for tax policy under former President Barack Obama, told AFP the negative reaction was “understandable.”

“People focused on the amount of the refund but that’s not the same as their tax liability, the amount of tax they pay for the year,” he said.

Because of lower withholding during the year, some taxpayers have in effect already seen the benefit of the tax cut in their higher paychecks, said Mazur, who is vice president at the Urban Institute.

About five percent of taxpayers — 7.5 million people — will in fact see a tax increase, while about 80 percent should pay less, he said.

Tax payers, US
The reform cut some popular deductions, sometimes resulting in thinner refunds or even unexpected tax bills. Pixabay

‘Angry, disappointed and betrayed’

The IRS on Wednesday said taxpayers who suddenly found they owe taxes could pay their bill in installments and apply for a waiver of penalties normally imposed for failing to pay by the deadline.

“The IRS understands there were many changes that affected people last year, and the new penalty waiver will help taxpayers who inadvertently had too little tax withheld,” IRS Commissioner Chuck Rettig said in a statement.

A key change of the 2017 tax reform is it limited federal deductions for certain state and local taxes like real estate taxes. As a result, many homeowners in states with higher property taxes will owe more to the federal government.

Neil Frankel, a New York accountant, told AFP people were feeling “angry, disappointed and betrayed.”

“I sympathize with them. The new tax law’s withholding tables were incorrect and misleading. A complete shenanigan,” he added.

“Since my clients are mostly professionals, I don’t really hear any screaming,” he said. “However, I do hear long diatribes on hatred for the U.S. government.”

Last year, Treasury Secretary Steven Mnuchin invited taxpayers to use an online calculator to estimate their tax payments, to determine if they should modify their withholding amount.

Tax payers, US
Under Obama, however, a tax cut showed up as smaller withholdings and fatter checks during each pay cycle. Pixabay

‘Misleading’ reports

This week, the Treasury Department said media reports on the lower refunds were “misleading.”

“Refunds are consistent with 2017 levels and down slightly from 2018 based on a small, initial sample from only a few days of data,” the department said on Twitter.

But, Mazur said, perception is key: When the administration of former President George W. Bush cut taxes in 2001, it mailed out checks directly.

“Taxpayers remembered that they got that check,” he said.

ALSO READ: Trump is ‘Looking for Land Mines’ in Border Deal

Under Obama, however, a tax cut showed up as smaller withholdings and fatter checks during each pay cycle.

“Most Americans when they were surveyed didn’t think they got a tax cut from Obama,” he said. (VOA)

Next Story

US Government Begins Probe into Google Over its Labour Practices

"Four of our colleagues took a stand and organised for a better workplace. This is explicitly condoned in Google's Code of Conduct, which ends: 'And remember... don't be evil, and if you see something that you think isn't right -- speak up.' When they did, Google retaliated against them," the employee activist group wrote in the blog post

0
Google Search Engine
Google Logo. Pixabay

The US government has launched a probe into Google over its labour practices following a complaint from four employees who have been fired by the tech giant.

The four workers who filed a lawsuit against the company last week, claimed they were fired from Google for engaging in legally protected labour organizing, reports CNN Business.

The National Labor Relations Board has begun a formal probe into the complaint.

The tech giant has been accused of “union busting” and retaliatory behaviour after it sacked four employees for allegedly violating the company’s data security policies.

In a statement, Google said it dismissed four individuals who were engaged in intentional and often repeated violations of its longstanding data security policies.

Google
US begins probe into Google’s labour practices. Pixabay

“No one has been dismissed for raising concerns or debating the company’s activities,” said the company on Monday.

Google is in the midst of controversy over its strained relationship with employees.

In an earlier blog post on Medium, an employee activist group, “Google Walkout for Real Change”, said that the company is illegally retaliating against prospective union organisers.

Also Read: Cricket Icon Mahendra Singh Dhoni to Back Show on Army Officers

“Four of our colleagues took a stand and organised for a better workplace. This is explicitly condoned in Google’s Code of Conduct, which ends: ‘And remember… don’t be evil, and if you see something that you think isn’t right — speak up.’ When they did, Google retaliated against them,” the employee activist group wrote in the blog post.

The new CEO of Alphabet Sundar Pichai faces extreme challenges as Google stares at several high-profile external probes into its alleged anti-trust market and data practices — from the US to the European Union regulators — including internal tensions with staff over discrimination at work and HR transparency. (IANS)