Survey finds majority of Americans can't cope with expiring 2017 tax cuts

With Tax Day just ahead, a new survey from the Cato Institute reveals a growing anxiety among Americans over the prospect of higher tax bills – especially if the 2017 tax cuts expire this year as scheduled.

According to the 2025 Fiscal Policy National Survey, conducted by YouGov for the Cato Institute, 81 percent of Americans say they can’t afford to pay higher taxes next year.

The survey report unveiled on Monday underscores a notable disconnect between public awareness and federal tax policy, with more than half of respondents (55 percent) unaware that the 2017 Tax Cuts and Jobs Act is temporary and set to expire.

Even with that knowledge gap, the survey revealed charged attitudes around current tax burdens. Fifty-five percent say their taxes are too high, and the same share believes they pay more than their fair share. Yet, 51 percent also say their taxes are handled fairly, highlighting a nuanced mix of frustration and resignation.

Awareness shapes opinion significantly. Once respondents were informed of the pending expiration of the 2017 tax law, support for preserving the cuts increased. Fifty-three percent favored either permanently extending (36 percent) or temporarily renewing (17 percent) the tax cuts.

Support swelled even more when the financial implications were made clear. After hearing that average tax bills could rise by $1,000 to $2,000 per year, 85 percent favored keeping the tax cuts in place. Notably, even when told the policy could reduce federal revenues by an estimated $5 trillion over the next decade, support remained high with 82 percent still backing extending the cuts.

“Businesses and families need stability of the tax code to plan for the future” was the most persuasive message tested. When the argument is framed this way, support for making the tax cuts permanent jumped to 75 percent.

A March survey report from CFP Board, the credential-granting body for CFP professionals, warned of a "tax tipping point" for Americans if the TCJA tax cuts are allowed to expire, with 90 percent of financial professionals believing the changes could pose significant risks to clients’ long-term financial goals. The top concerns revolved around retirement income and legacy planning, with 57 percent and 53 percent of survey participants, respectively, flagging them as vulnerable areas.

From a macroeconomic perspective, 43 percent of respondents to the Cato Institute's survey research believe letting the tax cuts expire would hurt the economy, while 45 percent expect their own taxes would go up. 

The study also found tax priorities clearly skewing toward working- and middle-class relief: 61 percent want to reduce taxes on the poor, while 59 percent support cutting taxes for the middle class.

Probing people's views on the $10,000 cap on state and local tax (SALT) deductions, the institute found two-thirds (64 percent) initially in support of extending the cap. Those opinions shifted slightly after hearing counterarguments, with 57 percent favoring its removal after hearing the case for avoiding double taxation across state and federal levels.

Earlier this month, House Republicans drafted a tax bill featuring a whopping increase to the SALT cap, pushing the maximum dedcution up to $25,000 for individual taxpayers. To offset the fiscal costs, some lawmakers reportedly mulled limiting the equivalent SALT deduction for corporations and businesses, which drew a scathing rebuke from one Democratic voice.

"Eliminating the C-SALT deduction would be a devastating, ill-advised move that would thrust American businesses into turmoil," Tom Suozzi, who represents New York’s Third Congressional District, wrote in a recent commentary on the Wall Street Journal.

Another policy area gaining traction is tip taxation, which both President Donald Trump and Former Vice-President Kamala Harris sought to score points on during last year's furious race to the White House. When presented with arguments on both sides, 61 percent said tips should no longer be taxed, pointing to the need for tax relief among service industry workers.

Beyond tax policy specifics, the data from the Cato Institute suggest that most Americans are not hostile toward wealth creation. Nine in ten respondents agreed there’s nothing wrong with earning as much money as possible honestly, and 71 percent disagreed with the notion that allowing people to become billionaires is immoral.