Trump Tax Cuts Results, Part Three: Bigger Paychecks

October 7, 2020 — Blog   

The Tax Cuts and Jobs Act, championed by President Trump and congressional Republicans, spurred a boom in economic growth that took Americans off the sidelines and got them back to work. Thanks to these reforms, our economy doesn’t have to strain under a tax code from 1986, but will recover with a modern, dynamic tax code that promotes growth.

BIGGER PAYCHECKS

What TCJA Did: 

  • Cut income tax rates across the board.
  • Nearly doubled the standard deduction.
  • Doubled the Child Tax Credit.

How the Economy Responded:  

  • Workers’ networth soared. Low- and middle-class families saw the largest gains in wealth growth in 2018 and 2019, according to the Federal Reserve. Low-income families saw their net worth increase 37%. Middle-class families saw their net worth increase 40%.
  • Household Income Reached New Highs. Real median U.S. household income in 2019 rose nearly 50% more than during the eight years of Barack Obama’s Presidency. Median household incomes increased 7.1% for Hispanics, 7.9% for Blacks,10.6% for Asian Americans and 8.5% for foreign-born workers.
  • Wages for Minorities Grew at a Faster Pace. Compared to Obama’s second term, wage growth, as a measure of median usual weekly earnings, grew 24% faster for Hispanics, 79% faster for Blacks, and 95% faster for Asian Americans.
  • Wages for Women Grew at a Faster Pace. Compared to Obama’s second term, wage growth, as a measure of median usual weekly earnings, grew 60% faster for women.
  • Wages for Youths (Ages 16-24) Grew at a Faster Pace. Compared to Obama’s second term, wage growth, as a measure of median usual weekly earnings, grew 70% faster for women.
  • Wages for All Levels of Educational Attainment Grew at a Faster Pace. Compared to Obama’s second term, wage growth, as a measure of median usual weekly earnings, more than doubled for those with less than a high school diploma and those with either some college or have an associate degree.

For a larger compilation of how the Tax Cuts and Jobs Act is helping all American workers and small businesses, including the information from this series, CLICK HERE.

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