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Talking Faith and Taxes

Talking Faith and Taxes

We all pay taxes. Let’s talk about it! Here’s a framework for approaching a conversation about taxes:

1. Begin with faith or values. Many faith traditions have teachings on taxes and economic justice.

    • Judaism has long preached about justice, and a just social order. The word tzedakah is connected to the obligation we have to make acts of financial charity towards people who are poor, carrying with it the idea that wealth is from God, and those with financial means have the responsibility to ensure those who lack resources are cared for and given the opportunity to eventually succeed on their own.
    • From the same religious foundation, Christianity embraced the ideals of social justice preached by Jesus. Early Christian communities stressed collective well-being and called upon one another to sacrifice for those who were poor and marginalized. Often, they created funds from community collections in order to provide goods and services to the widowed and poor. Most Christian religions continue to emphasize just economic practices and acts of charity.
    • Islam upholds the practice of Zakat, one of the five pillars of Islam. Initiated by the prophet Muhammad, Zakat is the obligation to give a portion of one’s wealth out of concern for those who are poor or dispossessed. In addition to its obvious use on earth, Zakat is seen as necessary for one’s salvation.

2. Discuss options for our tax system. There are three main types of taxes.

    • Progressive — A higher rate is paid by higher income brackets than lower income brackets (Note that this is achieved by applying higher marginal tax rates to higher levels of income)
    • Flat — A flat tax applies the same rate of taxation to all payers
    • Regressive — A lower rate is paid by higher income brackets than lower income brackets

3. Talk about what we don’t pay

    • Tax Expenditures encourage certain activities and benefit certain groups, and they come in three basic forms: deductions, exclusions, and credits.
    • Not all tax expenditures are bad — the Earned Income Tax Credit (EITC) lifts more families out of poverty than any other program, but others give wealthy corporations a sizeable cut on the taxes they pay that contribute to the common good.
    • The issue is that the government doesn’t count expenditures in the budget. Since these aren’t listed as expenses they’re often overlooked. Once a deduction is written, the money we could have collected is largely forgotten and the money we miss out on could lead to belt tightening and cutting in places that aren’t really at fault.

4. Think about the benefits we share in as a result of tax revenues

    • Whether it’s a public good that we all benefit from or a program that benefits certain groups, our tax revenues care for the common good in our nation and across the world.
    • Many of the programs funded by our taxes go to providing services or care for the marginalized that our different faith traditions call us to care for—those who are poor, sick, hungry, or otherwise vulnerable.

It really is up to us to decide what we want to do with our taxes, and the way we spend our tax dollars reflects our priorities as a nation. Start a conversation with a neighbor, family member, or friend about how our tax system can best provide for the common good.

For a more in-depth discussion of these topics, download NETWORK’s tax justice curriculum “We the Taxpayers” at:

Originally published in Connection magazine. Read the full issue here.

Supporting Tax Policies that Benefit Women and Families

Supporting Tax Policies that Benefit Women and Families

Anna Chu and Jillian Edmonds
August 16, 2017

The Trump administration and Republican leaders in Congress have promised to release a tax reform plan this summer, which is likely to include some of the largest tax cuts in decades. As elected officials debate tax reform, we must ensure policies that slash taxes for the wealthy few and big corporations under the guise of growing the economy do not become the new law of the land. The fallacy that tax cuts for the rich and corporations grow the economy has been the conservative talking point since Ronald Reagan first touted trickle-down economics, and has been widely discredited.[i] But not only is President Trump sticking to the same failed playbook of the past, the tax principles he released in April lack some of most important tax strategies that would help working families. For example, his principles do not mention expanding the Earned Income Tax Credit (EITC), an effective anti-poverty program which would greatly benefit working women and families. In 2013, the EITC lifted 6.2 million people – including 3.2 million children – out of poverty (when taking into account the indirect employment and earnings effects of the EITC, this number nearly doubles).[ii]

Although there are reports that President Trump is considering improvements to the Child and Dependent Care Tax Credit, those potential improvements alone do not mitigate the other troubling aspects of his tax plan. For instance, President Trump proposes reducing the corporate tax rate by 60 percent and getting rid of the estate tax, which impacts only the richest 0.2 percent of estates (including his own estate).[iii] Coupled with his budget, which guts crucial programs that provide basic living standards to low-income Americans, what emerges is a clear picture of the Trump administration’s economic policy—giving big payoffs for the wealthy few and big corporations, while pulling the rug out from everyday women and their families.

Tax Cuts for the Rich Just Make the Rich Richer

President Trump’s tax plan would be a massive giveaway to wealthy Americans and big corporations, and would harm women and families if enacted into law. He proposes slashing the top marginal individual tax rate to 35 percent and consolidating the current seven tax brackets into three. He also proposes slashing the corporate tax rate to an astoundingly low 15 percent. While he claims that such tax cuts would grow the economy and “create 25 million new jobs over the next decade,” this couldn’t be further from the truth. A Congressional Research Service analysis of the top tax rates since 1945 found little or no association between reducing taxes on the wealthy and increased savings, investment, or productive growth.[iv] A review of research by the Center on Budget and Policy Priorities of the impacts of a 1993 tax hike and the 2001 tax cut also revealed that job creation and economic growth were actually stronger in the years after the 1993 tax increases than in the years following the 2001 tax cuts.[v]

Instead of creating jobs or economic growth, tax cuts for the rich just make the rich richer. An analysis of OECD countries found that there was no correlation between the top tax rates and economic growth, but there was a correlation between lower top tax rates and greater income inequality.[vi] The earlier CRS study also found that cutting the top tax rate concentrates wealth at the top of the income spectrum because it incentivizes higher pay at the top end of the scale and allows those people to keep more of that money. By cutting taxes for the wealthy and corporations, President Trump’s tax plan will contribute to growing economic inequality in our nation, which harms both our current economy and future growth.

Tax Cuts Threaten Funding for Critical Programs

While women and families likely won’t get a fair shake in this upcoming tax plan, it’s not their only worry. President Trump’s tax principles work alongside his federal budget, which would cut programs that provide a basic living standard to low-income families. His budget proposes eliminating heating assistance for people in poverty, funding for meals for seniors, and several housing assistance. These cuts will affect women the most, potentially creating an even greater poverty gap between men and women. The Tax Policy Center found that cutting the corporate income tax to 15 percent would cost $2.4 trillion 10 years — and that number skyrockets to $4 trillion if the 15 percent rate applies to pass-through income.[vii]

Unless the White House plans to simply increase the deficit, these tax cuts must be paid for somehow. The Trump administration has claimed it would pay for these cuts by raising tax revenue from other sources and from economic growth, but the budget shows they are more than happy to slash critical programs that provide a basic living standard for women and families. President Trump’s budget proposes dismantling Medicaid as we know it and cutting its funding above and beyond the cuts in the ACA Repeal Bill. SNAP funding would be cut by nearly $200 billion over the next decade – which would result in many states making it more difficult for families to get food assistance..

The President’s desire to give huge tax cuts to wealthy people such as himself and take away critical programs that are lifelines for many women and families flies in the face of what his voters wanted and is a recipe for economic disaster. We can learn from what happened in Kansas, where massive tax cuts enacted in 2012 led to decreased revenue, underfunded schools, and cuts to services. Massive budget cuts won’t make America great again – but they are likely to hurt many people.

A Tax Plan that Actually Helps Women and Families

Our tax policies should help the most vulnerable Americans by improving family tax credits and raising enough revenue for programs and services that support struggling families, rather than giving more tax cuts and loopholes to the wealthy and corporations. To have a tax plan that actually helps working women and families, President Trump and Congressional leadership should consider abiding by the following principles:

  • Don’t give more tax cuts for the wealthy and big corporations.They should pay their fair share in order to have a tax system that works for all of us.
  • Tax policies shouldhelp the most vulnerable now. Tax reform should preserve — and improve — tax credits like the Earned Income Tax Credit, Child Tax Credit, and Child and Dependent Care Tax Credit that help families make ends meet.
  • Support progressive tax reforms that would raise needed revenue— and expand opportunity for a stronger future for everyone. Every year, special interest tax loopholes cost the federal government billions of dollars. That’s money that could be used to support struggling families and give them a chance for a better life.

A tax policy that supports women and children requires that everyone pays their fair share regardless of their income or political power. It allows the government to fully support families that need assistance when they are struggling, as well as fund public parks, clean air enforcement, and other government activities that benefit everyone. Rather than giving the wealthy and corporations the largest slice of the pie, a tax policy that supports women and children expands the pie for everyone, resulting in more opportunities that keep America great.

[i] CNN Money. “The ‘trickle down theory’ is dead wrong.”

[ii] Center on Budget and Policy Priorities (CBPP). “EITC Boosts Employment; Lifts Many More Out of Poverty Than Previously Thought.”

[iii] CBPP. “Repealing Estate Tax Would Provide Windfall to Heirs of Wealthiest Estates.”

[iv] Congressional Research Service. “Taxes and the Economy: An Economic

Analysis of the Top Tax Rates Since 1945.”

[v] CBPP. “Recent Studies Find Raising Taxes on High-Income Households Would Not Harm the Economy.”

[vi] Piketty, Thomas and Emmanuel Saez. “Top Incomes and the Great Recession: Recent

Evolutions and Policy Implications.”

[vii] CNN Money. “A 15% corporate tax rate could be very expensive.”

[viii] National Women’s Law Center. “Cutting Programs for Low-Income People Especially Hurts Women and Their Families.”

Originally published in Connection Magazine. Read the full issue here.

Getting Tax Reform Right for Our Nation

Getting Tax Reform Right for Our Nation

US Representative Mike Thompson (CA-05)
August 7, 2017

Economic inequality is a real problem that too many families face. Incomes have not kept up with the cost of living, and hardworking Americans are struggling to get by. So as Congress considers reforming our tax code, it must focus on leveling the playing field for the middle class and working families.

It’s been over thirty years since Congress made comprehensive changes to our tax code. A lot has happened in the interim—and our policies haven’t kept pace. We’ve seen the rich get significantly richer while the middle class keeps shrinking. Congress has the power and responsibility to change this trend. We can and should focus on reforms to create good, stable, high-paying jobs and help the men and women in our communities take advantage of the opportunities available to them now.

For instance, I’ve spoken with a number of my constituents who are trying to care for their kids, work a fulltime job, and go back to school so they can land a promotion or change careers. They are superheroes trying to do it all for their families, and they could benefit greatly if Congress expanded access to the American Opportunity Tax Credit, which helps millions of students and working families pay for college.

We should also look at policies that combat inequality. Expanding the Low-Income Housing Tax Credit, for instance, would provide more families with a place to call home. Improving the Child Tax Credit to keep pace with inflation would ensure families with young kids are able to pay their bills. I’ve co-sponsored legislation to expand all of these tax credits and provide additional help to everyday Americans.

These are not the only solutions, but they should be part of the discussion. Unfortunately, a number of my colleagues seem to think tax reform simply means tax cuts. That’s just not true.

It’s especially irresponsible to just cut taxes for the wealthiest among us—forcing everyday Americans to carry the bulk of our nation’s tax burden. Unpaid-for tax cuts create serious shortfalls, forcing our government to borrow more and more money. As lenders cut checks to federal borrowers, there could be less financing—and opportunities—available to entrepreneurs, mom-and-pop shops, and new startups. That’s bad for economy, American ingenuity, and anyone who wants to achieve their dreams.

We can make our tax code fairer, more competitive, and more efficient, but it shouldn’t come at the expense of a ballooning national debt. And Congress shouldn’t make promises it can’t keep.

While the corporate tax rate is in need of reform, simply slashing it to 15 percent is not going to help middle class families. It benefits big businesses that in some cases already pay less than their fair share in taxes while shipping jobs overseas. Tax cuts alone will not solve our problems. We need comprehensive reforms and programs that put people first.

We need to have the difficult conversations about what’s fair and what’s best for our communities. Tax reform isn’t easy, but it’s necessary if we want to close the wealth gap and help our families thrive.

Partisan rhetoric and ideology can’t be allowed to divide us. One party alone shouldn’t make changes to a tax code that affects all of us. We need to make sure we address the concerns of all our constituents, regardless of party.

As a senior member of the House Committee on Ways and Means, I’m ready to work with Chairman Kevin Brady and my colleagues on both sides of the aisle to make our tax code fairer. But make no mistake: Democrats will oppose any tax plan that only helps the rich get richer while forcing working families to shoulder even more of our country’s tax burden.

Originally published in Connection magazine. Read the full issue here

Welcoming the Northern Virginia Advocates Team

Welcoming the Northern Virginia Advocates Team

The newly organized Northern Virginia Advocates Team is working hard to support NETWORK’s goals in a variety of ways. Meet some of the members:

Team member Nancy Sheehy met Sister Simone a few years ago, but as a stay-at-home mother, she says: “I didn’t see myself being part of the NETWORK effort at that time.” In 2016, she helped register voters leading up to the election and soon after joined the team. Recently, Nancy participated in a lobbying visit to Senator Mark Warner’s office.

Mary Farrell writes, “To me, NETWORK is faith in action; going forward with the love and learning our faith has given us, bringing Jesus to the world. We hear it from Pope Francis! We all have a duty to do good, and NETWORK has given me the opportunity; for that, I’m very grateful.”

Stephanie Conley (also known as Nana Stephanie) heard about NETWORK’s advocacy on healthcare from Mary Farrell. Stephanie says, “As a former nurse, I am particularly concerned about healthcare. After participating in several visits to Congressional representatives urging them not to repeal the Affordable Care Act without a suitable replacement, I decided to join the team.”

Barbara Hazelett, explains, “The NETWORK vision and call to Mend the Gaps inspired me to dedicate a significant portion of my free time to furthering this mission.” On behalf of the team, Barbara has taken the lead in reaching out to interfaith organizations with common interests and to members of the Virginia Senate and House of Delegates.

Kathey Moore says, “Each of us share a commitment to Catholic Social Justice values and take actions that impact ‘the least of these.’” Equipped with training and handouts on the federal budget from NETWORK staff, Kathey visited the district offices of Senator Tim Kaine and Congressman Donald McEachin (VA-04). “We laid out our priorities: funding for the 2020 Census, funding for housing programs, no funding for a border wall and more.”

Janet Rife first visited the NETWORK office in 2003 just after the invasion of Iraq, to hear testimony from a group of Iraqi women. She says, “In 2016, I became freshly aware of the importance of NETWORK’s long experience, faith perspective, and tireless work in our nation’s capital. I am the mother of Brian, a 52-year-old man who sustained a traumatic brain injury in 1985 at the age of 20. In the ensuing years, I’ve been his advocate, often writing to legislators and lobbying in Richmond for better options for him and thousands of other Virginians with disabilities. Now, with the draconian cuts that have been proposed to Medicaid, I am highly motivated to be a NETWORK advocate.”

With four lobby visits already completed, the Northern Virginia NETWORK Advocates Team certainly has a bright future ahead of them, full of continued advocacy and growth! Please contact NETWORK organizer Catherine Gillette (email Catherine) if you are interested in joining the team.

Originally published in Connection magazine. Read the full issue here

Choosing Solidarity over Indifference

Choosing Solidarity over Indifference

Simone Campbell, SSS
July 24, 2017

When I say to groups that our primary issue to mend the income and wealth gap in our nation is tax policy, I often see eyes glaze over or people get ready to argue. But for us here at NETWORK, our faith leads us to engage this as a top priority and here is why!

What we have to remember is that from 1949 to 1979 every level of our society shared our post-war prosperity. The top marginal tax rate hovered around 80 percent. With that high of a tax rate at the top, executives were not as focused on increasing their salaries. In 1965, the average salary for a CEO was 20 times the amount for the average salaries of their workers.

This all changed in the 1980’s with the advent of Ronald Reagan and his “trickle-down economics.” Reagan and other supporters of this theory slashed tax rates for the top income bracket to less than 30 percent, and top executive salaries began to skyrocket while workers’ wages stagnated. In 2015, the average CEO salary was 303 times their workers’ average salaries. This is fueling our income and wealth disparity and hurting our people.

As Pope Francis says in Joy of the Gospel, paragraph 54:

…Some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world. This opinion, which has never been confirmed by the facts, expresses a crude and naïve trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system. Meanwhile, the excluded are still waiting. To sustain a lifestyle which excludes others, or to sustain enthusiasm for that selfish ideal, a globalization of indifference has developed.

This is the problem we have in our nation. The majority of people seem to be indifferent as the wealthiest people become more and more out of touch with those who are in the bottom 60 percent economically in our nation. We are becoming too far away from each other to be aware of our neighbors’ real needs.

Trickle-down economics has driven a wedge between those at the top and the rest of us, and our whole nation suffers as a result. But Speaker Paul Ryan and his colleagues continue to push trickle-down policies that give even more money to those who already have too much. The American Health Care Act (AHCA) that passed in the House of Representatives gave $680 billion in tax cuts to the wealthy over the next 10 years while taking away healthcare from 24 million people. This is wrong in any nation, but especially in a nation that can afford to provide care for its people.

NETWORK’s position on tax policy is at the heart of our solution to this challenging reality. We believe that everyone should pay a fair share. We also know that tax policy can promote or discourage certain behaviors. Our reflection and prayer lead us to say, let’s create tax policies that preference the common good and work to end the racial wealth gap.

We dream of incentives for corporations and business owners whose executives are paid no more than 40 or 50 times what their lowest-paid employee makes. Or – what if businesses that pay a living wage received a tax credit because their workers are not relying on the social safety net? Could the home mortgage interest deduction be designed to offset the serious and systemic housing discrimination people of color have experienced over generations?  These are just a few ideas, but the bottom line is that we need to end failed trickle-down policies and open our minds to a new way forward.

So, we urge you to join us in ending the indifference to unjust tax policies that is rife in our country. New tax policy will be created when our hearts are broken open to the needs of those around us. We all suffer in a system of cold, harsh individualism. Such a system is not aligned with our faith teachings or with the best of our nation. Let’s establish a tax policy that pays for the services our nation really needs and actively reduces the income and wealth gap. It is possible to achieve this goal through prayer and action. The time is now!

Originally published in Connection Magazine. Read the full issue here.