House Democrats concede ‘line in the sand’ over end of SALT cap – POLITICO | Vette Leader

Gottheimer said in an interview that the Anti-Inflation Act is a victory in his ongoing push to repeal SALT as Democrats fight back attempts to raise income tax rates.

“This law does not add a penny to taxes for families or small businesses in my district,” Gottheimer said. “We’ve also stopped those in red states who were trying to further undermine SALT and those who wanted to increase taxes on Jersey individuals and small businesses. The bill will actually save people thousands of dollars in prescription drug, energy and healthcare costs. We won.”

The fight over the $10,000 cap on state and local tax deductions has been voiced in the northeastern states and California, where property taxes are the highest nationwide. The Republican action in 2017 led to lawsuits from the then governor. Andrew Cuomo in New York, who claimed the tax law was wrongly targeting blue states.

The cap on property tax deductions affects the upper-middle class and wealthy families in suburban New York City, where property taxes can easily exceed $10,000 per year, limiting homeowners’ ability to take a break when filing their income taxes each year Submit. Some of the effects have been mitigated by other measures in the Tax Act 2017, e.g. B. through the almost doubled standard deductions and the increase in tax allowances for children.

Democrats used it as a rallying cry in elections, particularly in the battlefield suburbs, although lawsuits were thrown back in court. President Joe Biden’s “Build Back Better” bill, passed by the House last November, included a provision to raise the cap to $80,000 by 2030, but the full $2 trillion package stuttered in the Senate.

On Monday, opponents of the SALT Department in the House of Representatives admitted they would not stand in the way of the anti-inflation bill, saying the package will address climate change, boost domestic manufacturing and reduce prescription drug costs.

“The Anti-Inflation Act does not increase personal income taxes, and ‘No SALT, no deal’ does not apply,” Suozzi, the Long Island Democrat who is not running for re-election, said in a statement. “If an income tax rate change is proposed, I will insist that we restore the state and local tax deduction.”

The bill adds a 15 percent minimum tax for large companies and a new 1 percent consumption tax on share buybacks. It’s also stepping up IRS enforcement against tax dodgers and extending public health subsidies through the 2024 election.

Majority Leader in the Senate Chuck Schumer had also vowed to fight for the repeal of SALT for his hometown of New York, but he was unable to include this in the reconciliation package.

“One of the most damaging things that Republicans in the IRA were trying to do was extend the SALT cap and cost New York homeowners even more,” Schumer spokeswoman Allison Biasotti said in a statement. “Senator Schumer successfully fought this action and will continue to fight to have New York homeowners restore the SALT deduction.”

The SALT cap became part of the final negotiations over the weekend – specifically how the proceeds from it should be used. Republicans attempted to use the proceeds to exempt private-equity-owned companies from the new corporate minimum tax, but some Democrats declined and passed a separate amendment to pay for the change by increasing limits on certain tax write-offs for companies expanded.

With the midterm elections approaching, Republicans rushed House Democrats who passed the anti-inflation bill without repealing SALT, targeting Gottheimer and other New Jersey lawmakers. Tom Malinowski.

“What a convenient reminder for New Jersey voters just before the midterm elections that Josh Gottheimer and Tom Malinowski are unable to do anything for their constituents and to whom they are ultimately indebted Nancy Pelosi and Joe Biden when it matters most,” Samantha Bullock, spokeswoman for the National Republican Campaign Committee, said in a statement.

Malinowski’s office defended its decision on Twitter. Write that bill “Will reduce the cost of health care, prescription drugs and essential goods and fight the climate crisis. Americans deserve a break — which is why Tom will vote to pass this bill in the House of Representatives later this week.”

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