The progressive case for restoring the SALT deduction
By Froma Harrop / syndicated columnist
No serious economist believed that former President Donald Trump’s 2017 tax law would pay for itself. On the contrary, that buffet of tax cuts will explode deficits by almost $2 trillion over 11 years, according to Congressional Budget Office estimates.
Though the benefits went overwhelmingly to the highest-income Americans, red-state Republicans cleverly added an item that purported to raise some taxes on rich people. But not so much for their rich people. It primarily targets those in high-tax, high-income blue states. We speak of the $10,000 cap on the state and local tax deduction, or SALT, designed to drain revenues from the likes of California, New York, New Jersey and Massachusetts.
It’s sad but expected that naive progressives — think Reps. Pete Aguilar of California and Alexandria Ocasio-Cortez of New York — would fall for this attack on their own constituents’ tax bases. That the supposedly sophisticated minds at The Washington Post and The New York Times would also portray efforts to restore the deduction simply as a tax cut for the rich is astounding.
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Curbing the deduction forces Americans to pay taxes on income that’s already gone to paying taxes. But it’s more diabolical than that. It acts as an incentive for upper-income Americans to move to states with regressive tax laws and meager social safety nets; while at the same time degrading the tax bases of the very states that maintain progressive tax policies.
The reality, furthermore, is that the SALT deduction is used by decidedly middle-class people in high-cost-of-living areas such as Long Island. A cop married to a nurse in Levittown could easily report over $160,000 in combined income while also paying over $9,000 in property taxes.
https://www.heraldnet.com/opinion/harrop-the-progressive-case-for-restoring-the-salt-deduction/
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