How would the valley fare under the Senate tax plan?
Republicans in Congress are closer than ever to passing a tax plan, but, as the debate rages in Washington D.C., it can be hard to imagine how our community could be reshaped by its passage.
Sen. Democrat Michael Bennett ardently opposes the Republican tax bills. During a recent town hall on Facebook Live, Bennett stated he plans to vote against the Senate bill. His reasoning, ironically, was similar to how House Republican Scott Tipton justified voting for the House bill, which passed two weeks ago.
Rep. Tipton represents the Western Slope, where the House bill, he wrote, will “deliver relief for families and job creators,” rather than “preserve tax loopholes for special interests.”
Despite these partisan contradictions, economist Irwin Stelzer, a senior fellow at the Hudson Institute and a columnist for The Weekly Standard, claims the matter of the tax bills can be addressed simply.
“With any tax change, there are winners and losers,” Stelzer said. “You generally hear from the losers, and the winners try to hide.” Stelzer said the net effect of the House and Senate tax bills “is to help people with higher rather than lower incomes.”
Stelzer lives part-time in Aspen and has insight into what the Roaring Fork Valley could see, should the current tax end up passing.
“One of the winners are real estate developers, who for a long time were threatened with removal of their ability to deduct the interest on the big loans they always have,” Selzer said.
Jim Light, who’s been involved in the valley’s real estate business for decades, said deducting interest helps real estate developers, as it would help anyone borrowing money.
Light also said real estate in the Roaring Fork Valley would benefit from a clientele with even deeper pockets.
“Tax breaks for the very affluent are going to be generally beneficial to the mid-to-upper valley real estate because of who their buyers are,” he said.
On the bills’ losing end are people with expensive medical bills who, in the House version of the bill, would no longer be able to deduct those costs. Senate Republicans hope to repeal what’s called the “individual mandate,” which is the Obamacare law, penalizing not having health insurance.
Ross Brooks, CEO of Mountain Family Health Centers, fears if people aren’t required to buy health insurance, the younger and healthier won’t, leaving the older, sicker people paying much higher costs.
“We’ll see more and more uninsured in our communities,” Brooks said.
About one-third of Mountain Family’s 19,000 patients are already uninsured. Adding more could force them to trim services.
One more loser to the tax bill, said economist Irwin Stelzer, are the young people who have to pay for it.
“We are going to add to the national debt somewhere between $1.5 and $2.2 trillion over the next 10 years, because of these tax cuts, if the economy doesn’t boom as the Trump people say it will,” he said.
To assuage these kinds of fears, some Senate Republicans are advocating automatic tax increases, should the deficit grow too quickly going forward.
If the Senate is able to pass its own tax bill, they’ll take their version to the House. The two chambers of Congress will go back and forth until they reach an agreement, which would end up on President Trump’s desk, ready to be signed into law.