The tax bill passed by Republicans in the Senate is not terribly popular, yet it was still passed with no Democrats supporting it and one Republican holdout — Bob Corker of Tennessee. Two days earlier, graduate students walked out of colleges across the nation to protest the House version of the tax reform bill. Senate Republicans have insisted that this tax bill would provide much needed relief to people earning lower incomes, but the bill that they passed has a very different message.
The nonpartisan Tax Policy Center found that two-thirds of middle class families would have their taxes increase. The bill would get rid of some popular exemptions, like the one for state and local income taxes.
Most notably, this bill cuts the corporate tax rate from 35 percent to 20 percent, despite the fact that many corporations do not pay the full 35 percent. The wealthiest families would also experience a significant permanent tax cut, while some middle class families would experience a temporary tax cut. Overall, however, the group that would face the most significant changes would be college students.
In the current tax system, graduate students do not have to pay taxes on the money that they are given to continue their studies. That would change with this tax bill, as grants and subsidies going toward education would count as taxable income. This would also affect students pursuing their doctoral degrees as any money that these students receive in order to continue their education would be taxable.
The bill still has to be passed by the House of Representatives without any additional amendments. This could present a slight issue, as the tax bill that the House voted on has some significant differences with the Senate bill, and some of them are not so beneficial for students pursuing higher education.
In the bill that the House passed, the deduction on student loan interest would disappear. Under the current rules, students can deduct up to $2,500, which gives students making low wages some much needed relief.
Another issue that may affect students is a part of the bill that deals with the individual mandate portion of the Affordable Care Act, also known as Obamacare. The tax bill would make it so that people who do not purchase health care do not have to pay the financial penalty. While there is no certain outcome for this action, this provision is likely to greatly destabilize health insurance markets as healthy people either give up their health care or stop paying the penalty for not having it. This could signal the final destruction of Obamacare, as the individual mandate is one of the three critical parts of the legislation.
In order for the bill to be sent to the Oval Office and await the president’s signature, it has to be passed by the House of Representatives in its current form. However, if the House decides to amend it in any way, then the Senate will have to vote on it again, but this time with the changes that the House made.
The Republicans in the House of Representatives did pass their own bill. If the House fails to pass the bill that the Senate sent to them, then the Senate could vote on the House’s tax bill. Like with the other tax bill, this one would have to pass in the same form as it was written, so the House tax bill would have to be passed through the Senate without any amendments made to it.
President Trump has mentioned that he wants to get taxes done by Christmas, so it would be reasonable to predict that the House will pass some version of this tax bill as early as the end of this week. There is also a possible government shutdown to consider. A government spending bill needs to be passed by Dec. 8, so the Democrats could potentially use this looming crisis to their advantage, however repugnant they may find it.
If the public want to make their voices heard, now is the time. There is no turning back the damage that could be caused by this bill, and college students have more reason than most people to be angry. This bill is a direct threat to their futures, and they will have to live with the consequences if it is made law.