If the charitable deductions are limited, charitable contributions will decrease. That’s just math. Suppose you can afford to give $1000 to charity, and suppose (to make the math easy) that you are in a 50% marginal tax bracket and the new limit is zero. Then you will give just the $1000. Before the limit went to zero, when you gave $1000 you saved $500 on taxes, so you could give another $500. That saved you $250, which you could give, which saved another $125, and so on. In the end, you were able to give $2000. So your charitable contribution is cut in half.
Of course, the realistic effect is smaller. In general, if your marginal income tax rate is r, discretionary giving in excess of the limit is reduced by r. Again, that’s just math.
But when Ari Fleischer tweeted about this effect, liberals went crazy. Here’s a typical comment, selected for its lack of profanity:
lol talk about being a complete jerk, admitting you donate for the tax deduction #NoSoul
I think #NoMath would be more appropriate. No one donates just for the tax deduction unless their marginal tax rate is over 100%. Even if you get some back on your taxes, you still don’t end up ahead!
Fleischer tried to explain it:
For those having a fit re my charity tweet, when gvt reduces ppl’s take home pay, ppl have less $ to donate/spend. It’s math
Did I mention it’s just math? Sheesh.