Democrats push tax credit for union politics in Build Back Better Bill


A provision in Democrats’ $ 1.7 trillion social spending bill could be used to encourage political donations to Democratic candidates. critics of the arrangement say.

The most recent version of the bill allows a $ 250 tax credit that employees in unionized workplaces pay the “full” union dues. The tax credit would not go to union members who forgo paying the dues that go to support the political causes of the unions and campaign contributions.

Of 95% of union political donations support the liberal candidates, mostly Democrats, and the causes.

The tax credit has a “tricky design” to increase union membership, said Mark Mix, chairman of the National Right to Work Committee.

Taxpayers foot the bill for the first $ 250 in union dues, “Mix told The Daily Signal.” If you look at the ‘Build Back Big Labor’ bill, there are a lot of curiosities they offer to union officials, not necessarily frontline workers. ” .

Laws on the right to work that prohibit compulsory union membership are in effect 27 states.

A judicial precedent allows workers in the 23 states that allow mandatory union membership to withhold a portion of the mandatory membership fee when used for non-essential activities they oppose, including politics. Those employees still have to pay for core union functions.

The tax credit would be a financial disincentive for employees in 23 states without right-to-work laws to withhold money used for political dues, said F. Vincent Vernuccio, president of the Institute for the American Worker, who opposes compulsory union membership.

“You don’t have to pay the entire union dues in the 23 states, but you can pay what are called ‘agency taxes’,” Vernuccio told the Daily Signal. “Allowing only the tax credit for the entire union quota is clearly an incentive for union policy.”

In the course of negotiations between the far-left Democrats in Congress and the more traditional wing of the party, the provision on union dues was dropped. But even though the social welfare spending bill dubbed “Build Back Better” was cut from $ 3.5 trillion to $ 1.7 trillion, House Democrats reinstated that provision.

“This is a 2,000-page piece of legislation and the trade union dues provision is only one page and is clearly intended to incentivize membership because this administration knows that the Democrats’ strongest political supporters have been the trade unions,” Max Nelson, director of Labor Policy at the Freedom Foundation, which opposes mandatory membership, told the Daily Signal.

“The tax credit allows a union organizer to tell someone that you won’t save anything by withholding dues, so you might as well be a member in good standing,” Nelson explained. “Change the calculation.”

Late Friday, the Democratic-controlled House passed a $ 1.2 trillion infrastructure bill, with six Democrats voting against and 13 Republicans voting for. In a party vote that same night, Democrats backed a House rule to pave the way for a future vote on the $ 1.7 trillion social spending bill.

The bill would credit union dues “above the line“Deduction, which would be an expense taken from the calculated adjusted gross income. This differs from detailed deductions. Prior to the 2017 tax reform bill that lowered rates and closed loopholes, union dues were a detailed deduction.

The Modi e Means Committee of the Chamber first approved the measure as part of the bill in September. Earlier this year, Senate Democrats backed a bill called the Tax Fairness for Workers Act to make union dues an “over the line” tax deduction, which won union support.

“Reinstating employee tax deductions and unreimbursed union dues is an important spending step in undoing the damage the president [Donald] Trump and Republicans in Congress did so when they passed legislation that granted massive tax cuts to corporations by eliminating provisions that help working families, “Chris Shelton, president of Communications Workers of America, said in a statement in April on the Senate bill.

United Steelworkers International president Tom Conway said of the April bill: “Our tax system must support workers and their families, not just corporations and the ultra-rich. Unfortunately, Trump’s tax plan deprived workers of a long-standing deduction that helped ensure balance. ”

Unions likely pressured Democratic lawmakers to restore the provision for $ 1.7 trillion social spending legislation, said Rachel Greszler, an economics researcher at The Heritage Foundation, the parent organization of The Daily Signal.

“The problem is this uses taxpayer dollars to fund politics,” Greszler said. “Many union leaders have been more concerned with politics than with workers.”

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