Maybe lower your state and local taxes?
Democrats in some blue states do not like that President Donald Trump’s tax plan includes eliminating the ability to deduct state and local taxes.
Just a thought…maybe the states should not tax their citizens so much? Instead, they complain about the burden placed on the citizens from the federal government. From The Wall Street Journal:
At the center of the fight is New York, home of Mr. Trump, Mr. Cohn and Senate Democratic Leader Charles Schumer, who says killing or scaling back the break would be “devastating for middle-class families in New York and elsewhere.”
In New York, the deduction equals 9.1% of adjusted gross income, the highest in the nation, according to an analysis of government data by the Tax Foundation, a Washington group that favors a simpler, flatter tax system. New York residents thus face a particularly heavy state tax burden, which gets mitigated by the deduction.
The Republican tax plan is “very anti-New York in many ways,” says Rep. Joseph Crowley, a Democrat from Queens. “It’s going to cost more for New Yorkers. It’s going to be more federal taxes for them. And that simply isn’t right.”
But it’s not just New York. From The Hill:
In Oregon, lawmakers are trying to close a billion-dollar budget hole as revenues fall short of projection. New Jersey lawmakers grappled with their own billion-dollar shortfall last year. And in his initial projections, California Gov. Jerry Brown (D) said his state would have to cut costs to avoid a $2 billion deficit this year.
“The states that have higher progressive taxes and higher income residents who benefit from deductibility tend to be blue states,” said Iris Lav, a senior fellow at the left-leaning Center on Budget and Policy Priorities.
“This discount is pretty important, especially for states that want to have a somewhat higher and more progressive income tax.”
More progressive? What’s so progressive about placing high taxes on your citizens?
Secretary of Treasury Steven Mnuchin explained why the administration took this approach:
“It’s not the federal government’s job to be subsidizing the states,” Mr. Mnuchin said. “We’re not looking to necessarily raise taxes on the top 1% but we want to get the federal government out of the business of what’s the state’s business.”
National Economic Council Director Gary Cohn told the media it’s about leveling the playing field:
“We also think about being fair. We’re being fair,” Gary Cohn, the director of Mr. Trump’s National Economic Council, said at the briefing with Mr. Mnuchin. “And there are those that argue that allowing state and local taxes to be deductible is not fair because certain states are subsidizing other states, and this is a field-leveler.”
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