A group of seven Democratic governors is adding to calls within the party urging President Biden to repeal the Trump-era cap on state and local tax (SALT) deductions.
In a letter sent to the White House on Friday, the governors, including New York’s Andrew CuomoAndrew CuomoNYPD memo tells officers not to stop New Yorkers smoking marijuana in public Will vaccine passports be biggest campaign issue of 2022? Cuomo book deal negotiation overlapped with hiding nursing home death toll: report MORE, California’s Gavin NewsomGavin NewsomSuspect in California shooting knew victims: police Steyer says he has ‘no plans’ to run for public office again Trump Jr., Kimberly Guilfoyle buy M house near Mar-a-Lago MORE and New Jersey’s Phil Murphy, wrote that while the administration “has already taken incredible steps to ease the burden of more than a year of uncertainty caused by a global pandemic,” more must be done to fuel economic recovery.
“We must go further and undo the cap placed on State and Local Tax (SALT) deductions by the Trump Administration through the Tax Cuts and Jobs Act in 2017,” the governors argued.
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The rule, which was put in place by former President TrumpDonald TrumpWhite House says bills are bipartisan even if GOP doesn’t vote for them Gaetz bragged about ‘access’ to women through Florida tax collector charged in federal case: report Trump calls for boycott of MLB for moving All-Star Game MORE to help offset some of his tax cuts, limits SALT deductions to $10,000. Lawmakers from high-tax, Democratic-leaning states have long blasted the cap and pushed to reverse it.
The governors on Friday argued, “For the first time since Abraham Lincoln created the federal income tax, the cap on SALT deductions established a system of double taxation, where 11 million Americans were forced to pay taxes on the amount they paid in State, local, and property taxes, to the tune of $670 billion over a decade.”
“Like so many of President Trump’s efforts, capping SALT deductions was based on politics, not logic or good government,” they asserted. “This assault disproportionately targeted Democratic-run states, increasing taxes on hardworking families.”
“This was unacceptable then, and is simply untenable given the dire economic conditions caused by the pandemic,” the governors added.
The Democrats said that while it “was heartening to hear Treasury Secretary Yellen agree to work with Congress to ease the $10,000 cap on SALT recently,” the Biden administration and members of Congress must “continue these efforts to relieve this immense financial burden on our residents and eliminate the SALT cap entirely.”
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The joint letter was also signed by Govs. Ned Lamont (Conn.), J.B. Pritzker (Ill.), Kate BrownKate BrownOregon governor issues executive order to reopen schools Oregon governor orders schools to reopen by April 19 Colorado Gov. Jared Polis engaged to longtime partner Marlon Reis MORE (Ore.) and David Ige (Hawaii).
A growing number of Democrats are aiming to put pressure on Biden to rescind the cap on SALT deductions, including House members who have threatened to withhold support from Biden’s $3 trillion infrastructure proposal if the limit is not removed.
On Tuesday, Democratic Reps. Thomas Suozzi (N.Y.), Bill PascrellWilliam (Bill) James PascrellDaily Poster founder discusses conservative Dems’ strategies to influence Biden Pelosi ‘hopeful’ Democrats can reform SALT tax in Biden infrastructure bill Biden sets off Capitol Hill scramble on spending, taxes MORE (N.J.) and Josh GottheimerJoshua (Josh) GottheimerDaily Poster founder discusses conservative Dems’ strategies to influence Biden Pelosi ‘hopeful’ Democrats can reform SALT tax in Biden infrastructure bill Biden sets off Capitol Hill scramble on spending, taxes MORE (N.J.) released a joint statement vowing to oppose any efforts to change the tax code unless the SALT deduction is restored.
House Speaker Nancy PelosiNancy PelosiPelosi, Schumer speak with family of officer killed in Capitol attack Republicans quietly say Gaetz’s days in Congress are numbered Officer slain in vehicle attack at Capitol identified MORE (D-Calif.) on Thursday expressed optimism on including tax code reforms within Biden’s infrastructure package, though she stopped short of drawing a red line.
Pelosi said on a press call, “Hopefully we can get it into the bill. I never give up hope for something like that [that] means so much to the American people.”