Although Biden's claim is slightly exaggerated, Trump's tax cuts overwhelmingly favors the rich.
Under President Donald Trump’s administration, the Tax Cuts and Jobs Act of 2017 reduced revenues collected from corporates by 31 percent and gives more than $1.3 trillion in cuts to them. Although, corporations seemed to have benefited from such cuts, most Americans paid less taxes as well.
Lowest since 1939, the bill cut the corporate tax rate of 35 percent to 21 percent. Historically, corporations have always had lesser shares in total tax bills despite their surging profit. And with the new law, half of the tax cuts went to the top ten percent of taxpayers, or those making at least $200,000, according to estimates reviewed by the Philadelphia Inquirer. The flow of repatriated corporate cash became a flood of payouts to shareholders, both as buybacks and dividends, that hit an estimated $1.3 trillion, according to New York Times.
An analysis by the Tax Policy Center found that the top 1 percent of income earners would get 20.5 percent of the tax cut benefits in 2018. That percentage would go up to 25.3 percent in 2025 and then jump to 82.8 percent in 2027.
Trump’s tax plan’s which include $1.2 trillion in income tax cuts are heavily weighted towards the wealthy. And only the corporate tax cuts are permanent, according to Mother Jones. In 2027, 70 percent of middle-income taxpayers will get a tax hike—but just 8 percent of those making more than $5 million will.
However, the new laws did trickle down with about 65 percent of households paying less in federal income taxes than they would have under old laws, with the highest earners receiving the biggest benefits, according to the Inquirer.
A December 2019 study from the Institute on Taxation and Economic Policy, identified 91 corporations that said it did not pay federal income taxes on their U.S. income in 2018, the first year under the law. Amazon, for example, projected paying no federal income taxes for 2017 and 2018, but it did estimate paying taxes for 2019.
A higher percentage of high-income taxpayers got a tax cut. On average, that tax cut was more significant than the tax cuts for those with lower incomes. Although the bill signed by Trump leans heavily towards aiding wealthier taxpayers and corporations, Biden’s estimate was slightly exaggerated.