Monday, May 27, 2019

To be charitable, GOP tax policy isn't

            NPR still got the car.

            The donation to public radio was the wish of a son who had driven the '98 Mazda, its red paint peeling, until its dying moments.

            I was in favor, since public broadcasting needs our support in the face of Republican exercises in false economy and rigged scarcity – a trillion in added debt over the next decade from unnecessary and genuinely stupid tax cuts.

            The better to strangle important programs like food stamps, education funding, help for the disabled, and of course public broadcasting.

            So, I was all for the donation. At the same time I was anticipating listing it on my tax returns as would have been the practice before Donald Trump and his slovenly enablers changed the tax laws.

            I wasn't aware of one change: Unless one itemizes, charitable deductions are out.

            With the standardized deduction doubled, this eliminates most who live from paycheck to paycheck.

            One would think this is a windfall, so stop your whining. Tax cuts for people in the middle have been minuscule, while those making $100,000 and above have been generous.

            For this, we have an annual federal deficit which, though declining when Barack Obama handed over the keys. According to usgovernmentdebt.us/federal_deficit, the annual federal deficit was $442 billion in 2015, but by 2018 it was $779 billion.

            The charitable deduction isn't the only thing that went away for non-itemizing earners. So did the deduction for work expenses – yes, you teachers who bought supplies and other things for your classes.

            Meanwhile, some other deductions were swept away whether one itemizes or not: moving expenses, tax preparation fees and casualty losses. Also, the deduction for state and local taxes has been acutely limited.

            To what end? If it resulted in a streamlined, common-sense tax system that benefited all comparably and paid for what government we need, we could all applaud it.

            This does not do that. That applied as well to Republican tax reforms in the Reagan years. We had an opportunity to raise the revenue to stop the bleeding caused by supply-side economics. Instead, Reagan's mandate was that the changes be "revenue neutral."

            Well, no amount of voodoo will allow Donald Trump to demonstrate that, though the standard Republican claim was that the tax cuts would pay for themselves. This is a lie decades in the framing.

            So, what has the tax change done to charities that rely on small donors in addition to the big ones? It's too early to know the full extent.

            A projection coming into this tax year was that the law would cause a 4 percent decline in charitable giving.

            Thank goodness small givers aren't driven by tax policy. They are driven by goodness.

            Nonetheless, it's ridiculous that wealthy givers can deduct their acts of generosity, as if theirs are the only ones that matter, while the less wealthy will file theirs away under "D" for "decency."

            The Charitable Giving Coalition is lobbying Congress to make charitable donations tax-deferred regardless of how one's taxes are paid.

            The fact is that roughly half of all Americans who once deducted donations no longer can do so under the Republican tax law. In Colorado alone, that applies to $1 billion worth of charitable donations, according to the Colorado Nonprofit Association.

            Once again, most of those donations will continue, because people care about the institutions they support.

            Under the new tax law, the institutions Donald Trump and his acolytes support are multi-national corporations, their boards and the trust funds of the super-wealthy.

            I did have good news to harvest in researching this commentary. I found out that though federal tax laws don't allow me to deduct the cost of my donation to NPR, Colorado law does that very thing.

            Regardless, we did the right thing. It felt good. Try it, Mr. President.

            Longtime newspaperman John Young lives in Colorado. Email: jyoungcolumn@gmail.com.

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