Please Pass the SALT
Tax reform is the key to unlocking the American dream for millions of people. The Tax Cuts and Jobs Act, released last week, would raise the standard deduction for families from $12,700 to $24,000, increase the Child Tax Credit from $1,000 to $1,600, and cut the tax rate on workers with low and middle incomes.
Each of these provisions is aimed squarely at providing necessary and overdue relief. Today’s tax code is not only outdated and onerous, it favors the wealthy and well connected.
But I worry about the way this bill erodes the deduction for state and local taxes, which has been in place since 1913. Although the Tax Cuts and Jobs Act would let Americans continue deducting up to $10,000 of property taxes, it would eliminate the deduction for state income taxes.
Albany has also increased the weight of local taxes by imposing one unfunded mandate after another on local governments. Nowhere is this more apparent than in the property taxes my constituents pay. A 2013 study from the Brookings Tax Policy Center ranked more than 3,000 counties by their ratio of property tax to home value. All eight of the counties I represent in upstate New York are in the top 36 nationwide. Cortland County comes in at No. 6 and Oswego County at No. 15. But these areas are far from wealthy. To the contrary, average family incomes are well below the national average. My constituents are struggling to pay for Albany’s litany of costly rules and regulations.
The ability to deduct state and local taxes on their federal return matters because these New Yorkers cannot count on Albany to protect them. While families are falling behind or leaving the state, spendthrift liberals in the capital continue to waste money on boondoggles like the Buffalo Billion, Gov. Andrew Cuomo’s costly effort to revitalize Western New York’s economy, which has so far led to nine federal corruption charges; Start-Up NY, the governor’s signature job-creation program, which has produced a tiny fraction of the jobs it promised despite a $53 million advertising budget; and “film tax credit” giveaways to Hollywood elites worth hundreds of millions of dollars.
Each year, taxpayers fund Mr. Cuomo’s economic-development and job-creation programs to the tune of nearly $8 billion. Although New York spends more than any other state on these programs, we have little to show in return except record out-migration of jobs and people. Much of this spending is corporate welfare designed to curry favor with Mr. Cuomo’s donor class at the expense of the taxpayers.
The bad habits in Albany won’t change. That’s why it’s vital to retain the SALT deduction, which for now will remain the taxpayers’ only source of significant relief.
Congress has a historic opportunity to pass a comprehensive tax reform that would truly level the playing field for American families and small businesses. Then the onus will be on Democrats in Albany to get on board, put taxpayers first, and make New York competitive again.
Ms. Tenney, a Republican, is a U.S. representative from New York.
Appeared in the November 7, 2017, print edition.