By: Charles Krenmore

The House of Representatives voted last week to repeal the cap on state and local tax, or SALT, deductions.

If passed into law, the bill would repeal the $10,000 cap in 2020 and 2021, and raises it to $20,000 for married couples for 2019. The measure is offset by raising the top individual tax rate to 39.6% from 37%.

“Republicans, with Democratic support, amended the legislation at the last minute to prohibit those earning $100 million or more a year from deducting their entire state and local tax bill, a move that would prevent extremely wealthy taxpayers from benefiting from the more generous SALT allowance. The change also allows first responders and teachers and write off $1,000 for work-related expenses,” reported Crain’s New York Business. “But taxpayers shouldn’t call their accountants yet. Senate leaders have already said they won’t bring up the bill and the White House has threatened a veto.”

Congressman Tom Suozzi’s legislation received bipartisan support, including Republican members voting yes. The bill now moves to the Senate.

According to Suozzi, the capping of the SALT deduction was unfair to Long Island because:

– New Yorkers already subsidize other states by paying $48 billion more in taxes than they receive back from the federal government, more than any other state.

– The repeal of the SALT deduction results in double taxation by imposing a federal tax income which already paid for state and local taxes.

– State and local governments are being penalized – the creation of the SALT deduction was coupled with the creation of a federal income tax in 1913. When the 16th amendment was ratified, lawmakers at the time did not think it was fair for Americans to pay taxes on taxes.

– The elimination of the deduction drives people to other states and leaves middle- and lower-income taxpayers holding the bag to pay for school, police and other essential state and local tax burdens.

“Amid all the turmoil in DC, I am thrilled that the House, with bipartisan support, has passed my legislation to restore tax fairness for my constituents on Long Island. The 2017 cap on SALT broke a century-old agreement. A covenant to protect state and local government and my bill restores that protection, it restores that covenant, and it restores fairness, as well,” said Suozzi.

“Even before the GOP tax bill capped the SALT deduction, New Yorkers already paid more than their fair share of taxes. This bill would do justice for New York taxpayers by restoring the SALT deduction and providing additional assistance to teachers who spend money out-of-pocket on school supplies for their students. I thank Congressman Suozzi for his leadership in bringing Members across the aisle, including my Long Island colleagues, together in passing this legislation through the House,” said Rep. Gregory Meeks.