Today, U.S. Senator Kirsten Gillibrand joined a bicameral push to repeal GOP provisions of the CARES Act that provide a massive tax giveaway to a small group of wealthy individuals, instead of hardworking Americans the economic relief funding was intended for. According to the nonpartisan Joint Committee on Taxation (JCT), GOP changes in the CARES Act will reduce government revenue by $195 billion over ten years, overwhelmingly benefitting wealthy taxpayers like hedge fund managers and real estate speculators. These tax benefits from the Republican provisions dwarf payments flowing to working Americans which, based on the JCT’s analysis, will give an average benefit of $1.6 million to millionaire tax filers this year alone. In contrast, direct payments to most Americans under the CARES Act are capped at $1,200.
“This outrageous provision, led by Senate Republicans, gave handouts to millionaires but only provided $1,200 to support hardworking American families during this crisis” said Senator Gillibrand. “Imagine how many struggling New Yorkers we could help with the millions of dollars Republicans sent to the wealthiest few. This pandemic is not the time for corporate bailouts and tax cuts for the wealthy. Struggling American families and businesses are depending on us for support during this challenging time, and I’m proud to push for legislation to redirect funding to those truly in need.”
While thousands of Americans are struggling to keep their businesses afloat, afford basic necessities, and protect vulnerable family members from getting sick, the Republican provisions — sections 2303 and 2304 of the CARES Act — allow wealthy taxpayers to keep their benefits, no strings attached. Among other things, the changes allowed wealthy taxpayers to claim refund checks for the 2018 and 2019 tax years – before the coronavirus crisis hit. The JCT found that nearly 82 percent of those who will benefit from this provision make $1 million or more, with 95 percent making over $200,000.
Senator Gillibrand’s legislation, led by Sen. Whitehouse (D-RI) and Rep. Lloyd Doggett (D-TX), would repeal the Republican provisions and instead help small companies struggling to stay afloat. This provision would be available to companies with under $15 million in receipts that have not engaged in excessive executive compensation, dividends, or stock buybacks. In addition, the new provision would only apply to 2020 and would offer taxpayers advanced refunds of up to $100,000 now, when it’s most needed during this economic crisis.