PRESIDENT TRUMP SPENT a large portion of his State of the Union speech in February touting his economic accomplishments, including cutting taxes and “job-killing regulations.” But what has America gotten in exchange for the 2017 Republican tax overhaul?
First, 2018 showed the largest drop in household charitable contributions since the Great Recession and the first drop in more than five years. Despite steady economic growth over the past 10 years and a more than 5 percent increase in individual giving the year before, this dramatic decline has left many organizations—including local churches, food pantries, and homelessness services—struggling to meet the needs of those they serve.
The Republican-passed Tax Cuts and Jobs Act of 2017 was the most sweeping overhaul to the federal tax code in decades. Among other things, it doubled the standard deduction. It is no longer cost-effective for most Americans to itemize donations. This creates a “giving gap” between middle-class donors and ultra-wealthy donors.
Even some Republicans found these changes controversial. They were unable to hide that most benefits would accrue to Americans with incomes in the top 5 percent.
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