By
FPI Staff
|
November 13, 2017

Wealthiest 1 percent of Floridians Receive 35 Percent of Total State Tax Cut in U.S. Senate Tax Plan

This post was last updated on September 10, 2021. As new policies are announced, FPI will update this page.

As Florida’s response to COVID-19 takes front and center, concern grows for low-income families who struggle to take precautions against the spread of the virus. Although Congress has passed the Families First Coronavirus Response Act to address, at least in part,  the public health crisis and economic fallout from COVID-19, many barriers continue to keep struggling families from accessing the assistance they need during the pandemic. As Florida initiates policies implementing the Act and addressing other barriers to the safety net, FPI will update this form. When available, hyperlinks are provided to agency documents or statements that provide greater detail  about the new policy.
On March 22, 2020, FPI and 44 other organizations sent a letter to Governor DeSantis, leadership in the Legislature and agency heads to urge action on 47 specific policy changes to reduce unnecessary barriers for Florida’s safety net programs in response to the COVID-19 pandemic. See the letter here.

Proposal would increase federal deficit by at least $1.5 trillion over the next decade

LAKE MARY, FL – A 50-state analysis of the U.S. Senate tax plan released today by the D.C.-based Institute on Taxation and Economic Policy (ITEP) reveals that in Florida, the wealthiest 1 percent of residents, those earning $682,090 and over, would receive 35 percent of the total state tax cut in 2019, with their share growing to 39 percent by 2027.

“The U.S. Senate’s bill, like its counterpart in the House, would increase the federal deficit at least $1.5 trillion through 2027, provide a large share of cuts to wealthy residents and hamper state funding for public services,” said Joseph F. Pennisi, executive director of the Florida Policy Institute (FPI).

The Senate bill includes a new deduction for “pass through” entities, cuts the corporate tax rate to 20 percent and makes deep cuts to the estate tax, which only benefits the top 0.2 percent of estates.

The ITEP analysis reveals that the tax cut for the top 1 percent of households in Florida would increase from an average of $76,580 in 2019 to $93,4803 in 2027. Middle-income taxpayers’ average tax cut would increase from $610 in 2019 from $810 in 2027.

The analysis finds that in Florida:

  • Two percent of the wealthiest residents would see a tax increase in 2019 and 2027, compared with an average of 12 percent for those who earn $56,970 to $228,720, increasing to 13.5 percent in 2027;
  • The middle-fifth of taxpayers would see an average tax cut valued at 1.1 percent of pre-tax income in 2019 and 2027; and
  • The change as a percentage of pre-tax income for the top 5 percent of earners would be about double that of the bottom 80 percent in 2019 and 2027.

“Moderate- and low-income families would ultimately foot the bill for this tax legislation through reductions in programs and services,” said Pennisi.

The Florida Policy Institute is an independent, nonpartisan and nonprofit organization dedicated to promoting widespread prosperity through timely, thoughtful and objective analysis of state policy issues affecting economic opportunity.

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