WHEREAS:
Regressive tax policies at all levels of government are starving public services and harming working people while handing ever more wealth and power to corporations, private equity and the richest Americans; and
WHEREAS:
There would be nearly 1.5 million more state and local government employees today if funding for public services had kept pace with population growth since the onset of the Great Recession in 2007; and
WHEREAS:
Federal tax law greatly favors capital and the wealthy over American workers. The effective tax rate on labor is five times what it is on capital (25% vs. 5%), and the gap between the two has multiplied in recent decades as Congress and the president have bestowed huge tax cuts on capital and the wealthy. Further, while working people and retirees pay income and payroll taxes each year, wealthy Americans typically escape any taxes on the money they earn from capital gains, even passing their huge wealth from one generation to the next without those gains being taxed. As a result, the wealthiest Americans use their untaxed or lightly taxed wealth to accumulate even more wealth, pulling further away from everyone else; and
WHEREAS:
America’s 400 wealthiest families paid an effective tax rate of 24% from 2018 to 2020. Jeff Bezos had an estimated effective tax rate of just 15% in 2018. That is much lower than the 30% rate paid by the average American and much lower than what the top 400 richest Americans paid as recently as 2010 to 2017 because tax cuts enacted during the first Trump administration gave huge benefits to wealthy people; and
WHEREAS:
In 2025, Congress and the president bestowed even more enormous tax cuts on millionaires and billionaires as well as corporations through the One Big Beautiful Bill Act (OBBBA), with the top 0.1% of individual taxpayers, those with incomes of approximately $5 million and above, getting an average tax cut of $286,440 in 2026 alone and businesses getting $1.1 trillion in tax cuts over 10 years; and
WHEREAS:
Congress and the president made over $1 trillion in cuts to federal food assistance and health care through the OBBBA to pay for part of the new law’s huge tax cuts for corporations and the wealthy. Even with those cuts, the law will increase federal deficits by more than $4.1 trillion and by more than $5.5 trillion if its temporary provisions are made permanent; and
WHEREAS:
The cuts made by Congress and the president in the OBBBA to offset a part of its tax cuts are hurting families who are losing health coverage and food assistance. Those cuts are also shifting program and administrative costs to states and local governments, thereby putting huge financial pressures on them; and
WHEREAS:
On top of OBBBA, the Trump Treasury Department has given away hundreds of billions of dollars in additional tax cuts to corporations, wealthy individuals and foreign investors by gutting federal tax rules meant to prevent tax abuse and ensure corporations pay at least a minimum level of taxes; and
WHEREAS:
State and local tax systems are deeply regressive on average, with the lowest-income 20% of taxpayers paying higher effective tax rates than the top 1% — 11.4% vs. 7.2% — and the top 1% paying the lowest effective tax rates of any income group in 41 states. While some states have taken steps to increase their tax progressivity in recent years, others have enacted significant cuts that will make things worse, such as Missouri’s complete elimination of taxes on capital gains and proposed constitutional amendment that would eliminate income taxes, with sales taxes that hit regular Americans the hardest making up the difference; and
WHEREAS:
The richest 0.00001% of Americans — about 19 people as of today — now have a combined net worth equal to 12% of annual U.S. economic output. That is about a 12-fold increase relative to economic output compared to what that tiny group of people owned in the decades leading up to the 21st Century; and
WHEREAS:
The vast and accelerating accumulation of wealth by billionaires —the result of decades of changes to tax and other laws enacted by politicians paid for by those billionaires and the corporations they control —is creating extreme political inequality and now seriously threatens the “government of the people, by the people, for the people” that President Abraham Lincoln dedicated our nation to preserving more than 160 years ago, with the wealthiest people now investing huge sums into electing politicians who will do their bidding and defeating those who stand up for working people; and
WHEREAS:
An increasing number of large U.S. corporations are avoiding paying any federal corporate income taxes, with at least 88 of the largest corporations in America paying no federal income tax in 2025 despite having large pre-tax incomes. For example, Tesla paid no federal income tax despite having almost $5.7 billion of U.S. income; United Airlines paid nothing on almost $4.3 billion in income; and PayPal paid zero on $1.4 billion in U.S. income; and
WHEREAS:
Corporations continue to lobby for big tax breaks at the state and local levels, often demanding enormous subsidies to operate in a jurisdiction and pitting governments against each other in a tax-rate race to the bottom. Data centers are the latest example of this harmful game, with hugely profitable tech companies winning billions of dollars in tax subsidies through often secret deals and without much or even any public input; and
WHEREAS:
Congress and the administration have made harmful cuts to the Internal Revenue Service (IRS), hamstringing its ability to collect taxes from corporations and high-income, wealthy taxpayers with complex tax returns. The IRS budget is 40% below what it was in 2010 after accounting for inflation, with more cuts proposed for next year, and its staffing is down by more than one-fourth since 2025; and
WHEREAS:
To justify their enormous tax cuts for the richest Americans, congressional leaders like House Speaker Mike Johnson (R-La.) claimed the OBBBA would not add to the federal debt. To deal with the debts and deficits they created through their tax cuts, those same politicians point their fingers at core programs that sustain and protect American families, like Social Security, Medicare and Medicaid. President Donald Trump has said the federal government can no longer provide major benefits and should simply turn over responsibility for Medicare, Medicaid and child care to the states. Johnson, in talking about his secret 2027 plan, should he stay in control of the House of Representatives, said “your entitlement programs like Medicare, Medicaid and things like Social Security — they have to be adjusted and fixed,” and “[w]e have a plan to do that next year, and it’s critical, because we’re at $40 trillion-plus in debt;” and
WHEREAS:
Some progressive members of Congress want to address the affordability crisis through large tax cuts for some people paid for by increased taxes on wealthy Americans, but would not raise revenue to fund public services or policies that directly address the affordability of health care, child care, housing and other core needs essential to a decent life.
THEREFORE BE IT RESOLVED:
That AFSCME and its affiliates will advocate for progressive tax policies at the federal, state and local levels that raise the revenue needed to pay for the public services and benefits that Americans need and want, make it possible for them to lead a decent life, ensure the wealthy and corporations pay their fair share and address the vast and growing economic and political inequality in the U.S.; and
BE IT FURTHER RESOLVED:
That AFSCME and its affiliates will advocate against new tax giveaways to billionaires and other wealthy people and corporations, and will advocate for rescinding existing tax cuts for the wealthy; and
BE IT FINALLY RESOLVED:
That AFSCME and its affiliates will advocate for increased funding for tax enforcement by the IRS and at other levels of government to ensure the wealthy and corporations pay the taxes they owe and do not engage in abusive tax avoidance schemes.
SUBMITTED BY:
International Executive Board