WASHINGTON — The Trump administration defended itself on Thursday amid a barrage of criticism from angry taxpayers who are disappointed that they are receiving smaller tax refunds after the 2017 Republican tax cuts.
The slimmer refunds, which are down about 8.7 percent from the same period a year ago, have been seized on by opponents of the tax cuts and Democratic lawmakers as proof that the Republican tax law did little to help average Americans.
On Thursday, the administration rolled out fresh data to try to explain to taxpayers that their 2018 refunds were smaller because they received most of their tax cut in the form of bigger paychecks last year.
“Most people are seeing the benefits of the tax cut in larger paychecks throughout the year, instead of tax refunds that are the result of people overpaying the government,” a Treasury Department spokeswoman said. “Smaller refunds mean that people are withholding appropriately based on their tax liability, which is positive news for taxpayers.”
The Treasury Department said average refunds during the first two weeks of tax-filing season were down 8.7 percent from the same period a year ago to $1,949. About 27 million tax returns, or a fifth of the expected total, have been processed so far.
The new law cut taxes for about 80 percent of filers, though the amounts vary widely. The biggest cuts went to those at the upper end of the income spectrum, with the top 1 percent of earners projected to get an average tax cut of $51,000, or 3.4 percent of after-tax income, according to the Tax Policy Center. Middle-income earners are projected to get an average tax cut of $900, or 1.6 percent of their after-tax income.
After the tax law passed, the Treasury Department adjusted its withholding tables — which guide employers in determining how much to withhold in taxes from a worker’s paycheck — so that taxpayers would see the additional money immediately. But many workers may not have noticed since the tax cut was spread over a year’s worth of paychecks.
As a result, many taxpayers are now uncertain about whether they will be getting a refund from the government or if they will owe taxes.
A senior Treasury Department official said there appears to be confusion among some taxpayers who believe that a smaller refund means they have a higher tax bill. The official noted that financial advisers do not tend to encourage clients to seek higher refunds, since that essentially means taxpayers are overpaying the government throughout the year.
But some taxpayers prefer to withhold too much as a method of forced savings, while others view that as giving the government a loan with zero interest.
The tax law ushered in sweeping changes to the individual side of the tax code such as increasing the standard deduction and introducing a cap on the state and local tax break. Many of the changes were meant to simplify the system, but the transition has created confusion.
Democrats have seized on the disappointment as a political opportunity, in some cases fanning the incorrect assertion that smaller tax refunds mean Americans did not actually get a tax cut.
Senator Kamala Harris, a California Democrat and presidential candidate, wrote a post on Twitter about the smaller refunds this week and then suggested that President Trump increased taxes on the middle class. Most middle-class Americans are expected to see lower tax bills.
Representative Joyce Beatty, Democrat of Ohio, suggested this week that the smaller refunds were painful for struggling Americans who count on that money. She said the declines were a broken promise by the Republicans who passed the tax cuts.
“I think one of the things we were promised was that we were going to see it go up,” Ms. Beatty said, adding that smaller refunds will weaken consumer confidence. “People are upset about it.”
The Treasury Department official said on Thursday that it was expected that average refunds would be smaller this year and that most of the people who are receiving them are still paying less tax overall.