By SCOTT BRENT
For the Sunday Times
TAYLOR – Information about the Republican tax plan signed into law in December and how it will impact Michigan families in the years ahead was the focus of a town hall meeting hosted by U.S. Rep. Debbie Dingell (D-Dearborn) Jan. 13.
Under the Republican Tax Cut and Jobs Act of 2017, individual tax rates will be reduced, the standard deduction will double, and personal exemptions will be repealed until 2026. The state and local tax deduction will also be limited to $10,000, and the child tax credit will double to $2,000 until 2026.
Corporate income tax rates will be reduced from 35 percent to 21 percent permanently. There will be a 20 percent reduction for certain pass-through businesses, which are entities that do not pay a corporate tax. Rather, profits are passed through to the owners of the business, who report that income on their tax returns and pay a tax on it. The law also reduces taxes on existing foreign income and eliminates taxes on future foreign income.
Dingell began the meeting by restating her discontent with the GOP’s latitude toward multi-national corporations and the wealthiest Americans.
“Everyone knows where I stand – I voted against the Republican tax bill because it added trillions to our debt, promotes offshoring of jobs, kicks 13 million people off of their health care, and puts corporations over working families.”
Dingell then introduced policy experts, saying they were equipped to address the public’s questions. Maggie Randolph, a senior research analyst for the Center for Healthcare Research and Transformation, discussed the repeal of the individual mandate and what it means for health care.
“So what they did because of some arcane senate rules, they couldn’t actually eliminate the mandate, but they basically took away that tax penalty so now if you decide not to get health insurance, while technically still on the books that you are required to have it, you do not actually have to pay a penalty for it,” Randolph said.
“That will go into effect Jan. 1 of 2019. The reason this is really worrisome and the congresswoman flagged some of these numbers earlier – people who currently buy insurance on the marketplace will see increases in their premiums every year of 10 percent.”
This prompted many attendees to express concern over the cuts to Medicare and Medicaid compounded with the rising costs of affording health insurance.
“People are scared like you are,” she said. “They don’t know what to do if they get sick or if they get cancer. I’ll tell you what we really need to do is do something about escalating drug prices in this country. There are seniors who are choosing between eating and being able to take their medicine.
“You can’t do that in this country One of the first things we need to do — and I’m fighting for — is take Medicare Part D and negotiate lower prices for everybody.”
Many of the area state legislators and local officials on the town hall panel voiced their concerns over how the tax bill is expected to affect health care and the deficit.
State Rep. Abdullah Hammoud (D-15th District) pushed for a single-payer system to lower deductibles and co-pays.
“You eliminate the administrative burden, you bring down health care costs, and you slash auto insurance rates across the whole state,” Hammoud said. “That’s one of the reasons I’m a strong supporter of that.”
In addition to Medicare and Medicaid, Dingell addressed the public’s concern of potential spending cuts on Social Security due to the $1.5 trillion the tax cuts are projected to add to the deficit.
“There’s a group of pension retirees here that have spent a lifetime putting money into their pensions, and now when they hear theirs would be cut by 80 to 90 percent,” Dingell said. “They don’t know how they are going to live. I will work with President Trump to save their pensions. That is my job. I think people are tired of partisan victory and they want to see something done.”
Tom Lutz, financial secretary for the Michigan Regional Council of Carpenters and Millwrights Local 1045, was transparent on his view of using tax dollars more effectively.
“At minimum, this tax bill will cost us $1.5 trillion and it won’t create any jobs,” he said. “I don’t know about you but I look around and I can think of a few things we could do with $1.5 trillion.
“I see roads we could repair, bridges we could build, and good jobs we could create through investments in infrastructure and education rather than a handout to CEOs who have already admitted that this tax bill won’t create any new jobs.”
Romulus Community Schools President Robert McLachlan, expressed concerns over losing money in the school budget due to the repeal of personal exemptions in the new tax law until 2026.
“The general fund is only going to see about a 1 percent increase from the report I read,” he said.
State Rep. Darrin Camilleri (D-25th District) responded by citing Gov. Rick Snyder’s proposal to raise the exemption in 2021 from $4,300 to $4,500. Dingell said this effort could mean the difference between an extra supply of groceries for families, or having money set aside to afford their next supplement of medication.
“My concern is that my colleagues on the other side of the aisle would use this as an example to further reduce the monies coming in for the general education fund, by cutting taxes for the wealthy,” Camilleri said. “We will be fighting to ensure school dollars are not impacted by this change.”
Dingell and the panelists stressed that progress on this issue will stem from disposing partisan dialogue in the community, and how she looks forward to working with Republicans and Democrats to support Michigan’s future.
(Scott Brent can be reached at [email protected].)