Cuomo, Malliotakis, and other officials call on Congress to repeal the State and Local Tax (SALT) deduction cap

Cuomo, Malliotakis, and other officials call on Congress to repeal SALT deduction cap

Composite photo: (left) Rep. Nicole Malliotakis (Staten Island Advance/Jason Paderon); (right) Governor Andrew Cuomo (AP Photo/Richard Drew)

STATEN ISLAND, N.Y. -- Officials at the state and federal level are once again advocating for Congress to repeal the State and Local Tax (SALT) deduction cap.

During a press conference with the Association for a Better New York (ABNY) on Wednesday, Governor Andrew Cuomo listed lowering taxes as one of the solutions for restoring New York’s economy post-pandemic. He specifically discussed SALT as one of the obstacles to the state’s economic recovery.

“SALT, State and Local Tax Deductibility, was passed by Donald Trump. It was aimed at New York. It was a political gesture. It costs New York $12 billion per year. It has cost us $35 billion. It is the first double taxation in the nation’s history where the federal government now taxes the tax that you pay in New York City, in New York State,” said Cuomo.

The governor was referring to the Tax Cuts and Jobs Act passed in 2017, which included a provision that placed a $10,000 cap on taxpayers’ SALT deductions. This has particularly affected residents of high taxed states where their average SALT deductions had been well over $10,000. In 2019, New York, New Jersey, and Connecticut filed a lawsuit against the Internal Revenue Service hoping to repeal the deduction cap.

Cuomo explained that reversing the deduction cap would serve as a boost to New York’s economy as it recovers from being ravaged by the pandemic.

“[Repealing SALT] would be a tremendous immediate economic boost to New York. Taxes would be lower than they have been in the past four years. It would be the single biggest economic shot in our arm. It’s time to act,” he said.

The governor also called out New York officials including Senate Majority Leader Chuck Schumer, Congressman Jerry Nadler (NY-10), and Congresswoman Kathleen Rice (NY-04) for saying they were against the SALT deduction cap in 2017 but not having done anything to reverse it since.

Cuomo wasn’t the only official this week to call on Senator Schumer and others to address the SALT deduction cap. Yesterday, Rep. Nicole Malliotakis (NY-11), founding member of the bipartisan SALT Caucus, joined Rep. Andrew Garbarino (NY-02) and other colleagues in the House in sending a letter to Congressional leadership regarding the SALT deduction cap issue.

In the letter, the representatives inform Congressional leadership – Speaker of the House Nancy Pelosi, U.S. Senate Majority Leader Chuck Schumer, Minority Leader of the House Kevin McCarthy, and U.S. Senate Minority Leader Mitch McConnell – that the deduction cap is backfiring on state and local government tax revenues and disproportionately affecting middle class taxpayers in high tax paying states.

“Additionally, the cap on the SALT deductions has incentivized taxpayers from high taxes states to flee these areas, costing state and local governments valuable tax revenues,” the letter states.

“Many of our constituents, including teachers, first responders, and members of law enforcement earn incomes that are higher than many with the same jobs in other parts of the country, but these incomes make them middle class in the high cost of living communities we represent. We welcome you, and all our colleagues, to visit our home districts and meet the real people being penalized and financially harmed by the cap,” it continues.

In addition to being sent to Congressional leadership, the letter from Reps. Garbarino, Malliotakis, Lee Zeldin (NY-01), Jeff Van Drew (NJ-02), Mike Garcia (CA-25), Young Kim (CA-39), and Michelle Steel (CA-48) was also sent to President Biden and the White House.

Click here to view the full text of the letter

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