When Republican lawmakers jammed their massive tax cuts for rich people through Congress last year, they did it so arrogantly, so haphazardly, so outside-of-regular order that they royally screwed it up, introducing a whole mess of glitches that turned around and bit them in the ass. That’s because many of the errors they codified hurt their real constituents—the wealthy money managers, real estate brokers, multinational corporations, and agricultural conglomerates.
The latest snafu boomeranging on Republicans, however, is really going to hurt them. See, they unknowingly introduced a new tax on churches, who will now have to pay a “21 percent tax on some types of fringe benefits they provide their employees.”
It also means political peril for lawmakers, many of whom were surely unaware of the provision when they approved the tax plan. Churches’ tax-exempt status, in particular, has long been considered sacrosanct and Republicans are relying on the faithful to back them in the November elections.
Though many organizations are still unaware of the tax, more than 600 churches and other groups have already signed a petition demanding it be repealed.
“There’s going to be huge headaches,” Galen Carey, vice president of government relations at the National Association of Evangelicals, told Politico. “The cost of compliance, especially for churches that have small staffs or maybe volunteer accountants and bookkeepers—we don’t need this kind of hassle.”
Republicans purposely included this provision in the bill, probably to punish all the previously tax-exempt non-profits besides churches—colleges, hospitals, social service, and arts organizations. It was meant to provide “greater parity in the tax treatment of different types of employee compensation,” according to an aide to Texas Rep. Kevin Brady, chairman of the Ways and Means Committee. So if private companies lost the tax deduction they had for compensating employees for perks—meals, entertainment, transportation—then non-profits should have to pony up, too.
Unsurprisingly, this provision was added to the law without non-profit consultation, from the churches or anyone else. Brady is still defending it, but fellow Texas Rep. Michael Conaway has introduced legislation to repeal it.
In addition to the evangelicals, a whole mess of organizations including the National Council of Nonprofits are asking the administration to delay the tax, since Treasury still hasn’t worked out the regulations detailing exactly how this is supposed to work. This is despite the fact that it took effect January 1 and it was supposed to be paid quarterly starting then.
So now the tax law that Republicans were going to hinge their 2018 midterm hopes on has alienated yet another huge segment of their base—the far-right extremist segment of the evangelical movement. That means in another five months, the law is going to be even more unpopular than it is now.