The Polls Are In: People Want the Tax Cut Extension and Spending Cuts to Pay for It

By a 2-to-1 margin, there is support for TCJA extension as long as Congress offsets the tax reduction with spending cuts

The Fiscal Policy Initiative at the Hoover Institution has released a new poll on public perceptions of the Tax Cut and Jobs Act (TCJA) and whether it should be extended. The poll was spearheaded by my colleague policy fellow Tom Church, working together with data analytics firm YouGov, whose chief scientist is another colleague, senior fellow Doug Rivers. YouGov employs rigorous methods to obtain nationally representative polling samples.

The full poll results are here. There are a lot of questions (56 to be exact) and much to be learned about public perception of TCJA by poring over the cross-tabs. But here are three key takeaways based on some results that stood out to me.

1.) There is robust public support for TCJA extension “as long as they [Congress] offset the tax reductions with spending cuts.” 45% strongly/somewhat favor it, while 22% strongly/somewhat oppose. That is a 2-to-1 margin. The remainder are not sure. Support was less strong (39% favoring vs 30% opposing) if the extension would increase the deficit and debt. So note to Congress: the people are strongly telling you they want you to extend TCJA and also to offset the tax reductions with spending cuts.

2.) There is lots of support for the SALT cap and mortgage interest cap. 42% prefer to maintain or lower the caps. 22% prefer to raise the caps to their previous values. Surely the variation here to some extent depends on whether a respondent is personally affected by these caps, and of course the political calculus places members of Congress from high SALT districts in a bind. But overall the preference is clear: the SALT and mortgage base-broadening measures from TCJA are very popular, even without the question directly explaining to people that these measures implicitly allow for lower tax rates.

3.) When asked if they “favor or oppose having high-income earners pay a higher share of federal income taxes than they currently pay” there is at first glance a redistributionist zeal with 66% strongly/somewhat favoring. However, as I have discovered by running many polls of audience members when I give talks, people have no idea of the starting point, and that is very important.

In 2022, the top 1% earned 22% of the income and paid 40% of the taxes. The top 10% earned 49% of the income and paid 72% of the taxes.

Give people these facts and it quickly changes their views about whether the top earners pay their “fair share”. One exercise I like to do is to tell a group of students what percent of federal income is earned by one of these top income groups, and then ask them what percent of the tax burden they believe that group should bear. When students are told that the top 1% earned 22% of the income, it is a very small percentage who typically think they should bear more than 40% of the taxes. Most are very surprised to discover that the actual tax burden of the top 1% is 40% of the taxes paid.

So present the facts to the respondents about the current shares of income and taxes earned by different groups, and you’ll learn that actually people do not want even more income redistribution than we already have in the federal tax code.

Overall the people are clear on what they want: TCJA extension with spending cuts to pay for it.