How about that? Revenue stays the same after massive tax cut

[libertybele]

How about that? Revenue stays the same after massive tax cut

The latest budget figures from the Treasury Department demonstrate a concept we already knew but too many politicians continue ignore – we have a spending problem, not a revenue problem.

One would have expected gross revenue to plummet in February once the new tax rates were applied to withholdings for this year. My withholdings dropped already for the last two weeks in January but by February everyone should have seen the effects of the tax cut and revenue to the Treasury should have shrunk noticeably. After all, on some measure this was the largest tax cut in history. Yet compared with February 2017, gross revenue was nearly unchanged. It actually ticked up very slightly by $1.36 billion.

What gives?

It’s called economic growth. With more people working and more economic growth leading to upward mobility and higher wages, even though the Treasury lost some cash on withholdings, overall it has not lost revenue.

While withholdings for individual income taxes did decline slightly – from $116.7 billion to $110.7 billion – that is not nearly as much as one would have predicted had the Congressional Budget Office’s static analysis of massive revenue loss been actualized. Gross corporate tax revenue was essentially unchanged and the revenue loss from individual incomes taxes was made up through…you guessed it: more people having jobs. Payroll taxes as well as other sundry taxes and fees increased. Which means more people are working and the economy is growing. We now know that 313,000 jobs were created in February and 653,000 rejoined the labor force..............

https://www.conservativereview.com/articles/revenue-stays-massive-tax-cut/

[Concerned]

It'll be interesting to see what happens over the full year.  As noted by the link in the OP:

Obviously it’s still way too early to assess the budgetary effects of the tax cuts as much as we already assessed the economic effects and there is no doubt that over the course of a full year corporate tax revenue will fall and individual withholdings will decrease.

[DB]

Not everyone had their taxes lowered by this "tax cut"...

[goodwithagun]

I’m applying it to my mortgage principle.

[To-Whose-Benefit?]

When we have to mobilize the entire country to invade Europe and the Pacific and ration rubber and gasoline, I'll find time to worry about Keynesian Economic/Intentionally skewed 'Wealth is a Closed System/Finite Amount' BS hampering Govt. funding.

http://keynesatharvard.org

Oh Dear Lord! If ONLY, If ONLY, tax cuts alone could downsize Govt. by starving it.

[MajorClay]

Imagine that, all the predictions of the democrats have fallen flat.

[Night Hides Not]

I’m applying it to my mortgage principle.

I think you meant "principal".

[WingNot]

Not everyone had their taxes lowered by this "tax cut"...

You mean like the unemployed. Welfare peoples. Bums and such?

[Concerned]

You mean like the unemployed. Welfare peoples. Bums and such?

And folks who live in high state, local, and property tax states who have now had their SALT deduction limited to $10K.

[WingNot]

And folks who live in high state, local, and property tax states who have now had their SALT deduction limited to $10K.

Ah, those bums.   

[DB]

Ah, those bums.   

Ya I'm one of those bums, but I have a plan...

[truth_seeker]

And folks who live in high state, local, and property tax states who have now had their SALT deduction limited to $10K.

Is your position, those that live in high tax locations, should be subsidized by those in low tax locations?

I say this as a disappointed, nearly lifelong and native born Californian.

The stupidity of my state's government, should not fall on other's shoulders or wallets.

It already does however, in the form of federal contributions to the ill-conceived "high speed train."

https://www.google.com/search?q=california+high+speed+train+financing&num=20&newwindow=1&source=lnt&tbs=qdr:m&sa=X&ved=0ahUKEwil_qye_fjZAhUHJZQKHX-tD_sQpwUIIA&biw=1201&bih=634

[Concerned]

Is your position, those that live in high tax locations, should be subsidized by those in low tax locations?

I say this as a disappointed, nearly lifelong and native born Californian.

The stupidity of my state's government, should not fall on other's shoulders or wallets.

It already does however, in the form of federal contributions to the ill-conceived "high speed train."

https://www.google.com/search?q=california+high+speed+train+financing&num=20&newwindow=1&source=lnt&tbs=qdr:m&sa=X&ved=0ahUKEwil_qye_fjZAhUHJZQKHX-tD_sQpwUIIA&biw=1201&bih=634

No it is not my position that "high tax locations, should be subsidized by those in low tax locations".  I was merely pointing out that there were some people beyond the "unemployed. Welfare peoples. Bums and such" who didn't get tax breaks, and that not "everyone" got a tax cut as Trump has stated in the past:  folks like DB and myself apparently.

@truth_seeker

[LauraTXNM]

No it is not my position that "high tax locations, should be subsidized by those in low tax locations".  I was merely pointing out that there were some people beyond the "unemployed. Welfare peoples. Bums and such" who didn't get tax breaks, and that not "everyone" got a tax cut as Trump has stated in the past:  folks like DB and myself apparently.

@truth_seeker

The full effects won't hit until we pay 2018 taxes, right?

[Concerned]

The full effects won't hit until we pay 2018 taxes, right?

That's right, but depending upon your situation and your deductions losing SALT above $10K may result in what will obviously be a tax increase when we pay our 2018 taxes in April 2019.  I'm clearly in that boat.

[LauraTXNM]

That's right, but depending upon your situation and your deductions (or lack thereof) losing SALT above $10K may result in what will obviously be a tax increase when we pay our 2018 taxes in April 2019.  I'm clearly in that boat.

We're definitely there, too.  And despite my husband working for a very large company, we haven't seen any change in our paycheck, etc.

[Hoodat]

How about that? Revenue stays the same after massive tax cut

But spending went up.

[LauraTXNM]

But spending went up.

@Hoodat, You WIN ;)!

[Suppressed]

But spending went up.

@Hoodat, you just don't know how to do DC Accounting!


You see, they said revenue would fall.  But it stayed the same.  So that's an increase from the baseline.

Now, they can spend all that extra money and everything works out!

[thackney]

We're definitely there, too.  And despite my husband working for a very large company, we haven't seen any change in our paycheck, etc.

Why would the size of the company have anything to do with changes in your income tax withholding?

[LauraTXNM]

Why would the size of the company have anything to do with changes in your income tax withholding?

@thackney As I said, we haven't seen *any change in our paycheck* -yet-, and my husband works for a large company.  According to Trump, the media, and Pelosi's "crumbs", many large companies have been paying bonuses and raising salaries already because of their lower tax burden.  I'm curious that has not been true for my family's company, and it is one of the Fortune 500.

I wasn't referring to our tax withholding.

[thackney]

@thackney As I said, we haven't seen *any change in our paycheck* -yet-, and my husband works for a large company.  According to Trump, the media, and Pelosi's "crumbs", many large companies have been paying bonuses and raising salaries already because of their lower tax burden.  I'm curious that has not been true for my family's company, and it is one of the Fortune 500.

I wasn't referring to our tax withholding.

Thanks for clarifying.  I saw an significant change in my take home pay due to the tax change.  It was the result of the change in withholding with the new tax law.  I "assumed" you were talking about that change.

Cheers!

[Cyber Liberty]

@thackney As I said, we haven't seen *any change in our paycheck* -yet-, and my husband works for a large company.  According to Trump, the media, and Pelosi's "crumbs", many large companies have been paying bonuses and raising salaries already because of their lower tax burden.  I'm curious that has not been true for my family's company, and it is one of the Fortune 500.

I wasn't referring to our tax withholding.

Thanks for explaining!  I, too, work for a large company, and we have an entire HR department to fix the salaries, and an incentive system that pays out twice a year.  I expect if there are salary increases and out-of-the-blue bonuses going out, it would be among the smaller employers that don't have a rigid salary and bonus systems already in place.

In a large company I see no reason for either of those things to be affected by the Tax Reform law (although I might see incentives to make Capital Purchases change).  I did see the tax withholding change, but I know better than to consider extra throwing around money.  April still happens every year.

[LauraTXNM]

Thanks for explaining!  I, too, work for a large company, and we have an entire HR department to fix the salaries, and an incentive system that pays out twice a year.  I expect if there are salary increases and out-of-the-blue bonuses going out, it would be among the smaller employers that don't have a rigid salary and bonus systems already in place.

In a large company I see no reason for either of those things to be affected by the Tax Reform law (although I might see incentives to make Capital Purchases change).  I did see the tax withholding change, but I know better than to consider extra throwing around money.  April still happens every year.i

@Cyber Liberty  Doesn't it just!  I'd love to skip it just once ;).  I'll have to ask my hub -- I didn't see a withholding change?