The Taxation Election: Both Sides Emphasize Tax Policy In Closing Arguments

Every election turns on many issues. But if ever there was a time for taxes to be top among them, this is it.

By William Rice

Tax policy has moved to center stage in the closing stage of the presidential election. Among a dozen issues raised by both campaigns and their allies in TV ads running in the first two weeks of October, taxation received the most emphasis from each side. The forces working to elect former president and current Republican candidate Donald Trump spent over $25 million on tax-focused ads; while the team supporting his Democratic opponent, Vice President Kamala Harris, spent almost $50 million. 

This was more advertising money than the GOP side spent on ads highlighting immigration, inflation or crime. Democratic issues that received fewer advertising dollars than tax policy include healthcare and abortion rights. 

This allocation of advertising resources makes sense, since tax policy is an underlying element of nearly every other issue that matters to voters – from Social Security to childcare, national defense to national debt. Tax revenue fuels public policy. 

Of course, the two sides are saying very different things. The Washington Post Fact Checker decided that “just about everything” in a Trump-campaign commercial attacking Harris tax plans was “twisted or false.” This was the ad offered as the example of Republican tax advertising in the CNN report breaking down the two sides’ spending.

“We’re used to bad clip jobs and misleading citations, but this ad really takes the cake,” wrote Fact Checker Glenn Kessler, who called the Trump ad “a new low for a presidential campaign.”

The CNN report offered two examples of Democratic tax ads, one mostly criticizing Trump policies and another noting some of the contrasting plans of Harris. The critique of Trump tax plans begins with a clip of him speaking to a room of wealthy donors, noting that they are “rich as hell” and promising them tax cuts.  A Harris voter, who explains he is not rich as hell, argues that giving the wealthiest 1% another tax cut is “not cool” and points out that Harris will “make billionaires pay their fair share.” In its regular column on political ads, The New York Times found a basis for all of the Harris ad’s claims.  

Allowing (accurate) arguments about tax policy to help decide the presidential election – and congressional ones as well – matters greatly. That’s because one of the most consequential debates on taxes in our nation’s history is coming up next year, prompted by the expiration of most of the tax law enacted in 2017 by President Trump and a Republican Congress. 

Trump and the GOP want to permanently extend all of the tax cuts in that law – which heavily benefit the wealthy – at a cost of nearly $5 trillion over 10 years. That huge revenue loss can only be made up by cutting public services like healthcare, child care, education and housing; by raising taxes on working families; or by adding even more to our growing national debt. 

Harris and her fellow Democrats want to let the tax cuts exclusively benefitting households with over $400,000 of income to expire on schedule, saving trillions of dollars in public revenue while narrowing our country’s destabilizing income gap. 

But that’s not all. Democrats also want to use the expirations in the Trump law as an opportunity to reshape the tax code in ways that ensure the richest households and biggest  corporations start to pay closer to their fair share of taxes. Those progressive tax reforms include raising the corporate tax rate (the Trump law cut it by two-fifths); imposing a special tax on the handful of wealthiest households so that billionaires can no longer get away with paying little or nothing; and continuing to restore the funding of the IRS it can go on improving customer service and crack down on more rich tax cheats. 

Every election turns on many issues. But if ever there was a time for taxes to be top among them, this is it.