Let It Be Known That Trump’s 2017 Tax Cuts Hurt Black Americans

Trump touted that the tax cuts would benefit the middle class.

President Donald Trump’s 2017 Tax Cuts and Jobs Act expired on Dec. 31, 2024, and the research paints a grim picture: the cuts hurt Black Americans and worsened income inequality.

Trump touted that the tax cuts would benefit the middle class in what has been characterized as the most extensive revision to the Internal Revenue Code since Ronald Reagan’s administration.

Research from Vanderbilt Professor Beverly Moran, a scholar of race and U.S. income taxation, reveals more than 80% of the tax cuts benefited corporations, tax partnerships, and high-net-worth individuals.

There was little advantage to America’s middle class, and when breaking down the data, the benefits for Black Americans were even smaller. Part of the reason why many Black Americans did not reap the benefits has to do with home ownership.

How Tax Cuts Exasperated Disparities

According to Moran, the federal income tax can give homeowners an upper hand. However, many Black taxpayers cannot reap the benefits that include the ability to deduct home mortgage interest, local property taxes, and the right to avoid taxes on up to $500,000 of profit on the sale of a home.

According to figures from the National Association of Home Builders’ Eye on Housing, as of the fourth quarter of 2023, 45.9% of Black Americans owned a home in the United States, significantly lower than the homeownership for White Americans, 73.8% in the same period.

In 2023, a CNN report revealed a key fact that Black Americans have known for some time: it’s harder for middle-class Black people to secure a mortgage than low-income white people, even when Black Americans come to the table with higher credit scores and income. As Moran observed, Black people are charged higher rates than their white counterparts.

Trump’s 2017 tax cuts made closing the income and race disparities worse. Black taxpayers ultimately paid higher taxes than white taxpayers with the same income and employment factors.

According to Moran, the disadvantages expand to wealthy shareholders, who she said benefit from corporate tax savings.

Shareholders in the U.S. are corporations, pension funds, and wealthy individuals who are majority white. Sixty-six percent of white families own stocks compared to less than 40% of Black families.

As Trump’s tax cuts expire, it remains unclear what the GOP-led Congress will prioritize in 2025.