New York’s senators introduced a bill Friday aimed at restoring the state and local tax deduction, which they said would save property taxpayers billions of dollars.
Senate Majority Leader Charles Schumer and Sen. Kirsten Gillibrand, both Democrats, said the move would reverse a 2017 Republican effort that eliminated SALT, replacing it with a flat $10,000 deduction.
That same year, 5,700 Cattaraugus County taxpayers received an average of $11,246 in SALT deductions to their federal income tax, according to data from Schumer and Gillibrand. The SALT deductions totaled $64.1 million. Over 90% of county taxpayers claimed SALT deductions. In Allegany County, 3,230 taxpayers claimed $11,169 in SALT deductions worth about $36 million. That was 94% of middle class taxpayers in the county.
Together, nearly 9,000 taxpayers in Cattaraugus and Allegany counties claimed more than $100 million in SALT deductions in 2017, the senators’ data shows.
Across the 11-county 23rd Congressional District, 33% of taxpayers used the SALT deduction. The average state and local tax deduction across the district was $14,096.
“When it comes to SALT, New York families needed and deserved this money before the coronavirus took hold, the stakes are even higher now because the cap is costing this community tens-of-thousands of dollars they could be using amid the crisis,” said Schumer.
“That is why I am proud to be leading this legislation to restore our full SALT deduction. Double taxing hardworking homeowners is plainly unfair. We need to bring our federal dollars back home to the to cushion the blow this virus — and this harmful SALT cap — has dealt so many homeowners and families locally,” he added.
Gillibrand said, “I am proud to join my colleagues to introduce legislation to repeal the cap on the State and Local Tax deduction, a cynical policy passed by Republicans as a way to repay wealthy donors and lobbyists with big corporate tax cuts.”
Gillibrand added, “The reinstating of the SALT deduction will ensure that New York families have more money in their pockets, get much-needed tax relief and will once again be treated fairly.”
Gov. Andrew M. Cuomo, who has been beating the SALT drum all month, made another pitch Friday to eliminate the $10,000 ceiling on SALT. During this streaming coronavirus presentation, the governor said, “We need SALT (ceiling) gone.”
Cuomo also defended his $15 billion request for federal COVID-related aid from the $350 billion state and local aid portion of the COVID Rescue Bill proposed by President Joseph Biden. The $15 billion is “a fair request,” the governor stated. “We need $15 billion of the $350 billion, however they make the sausage.”
Cuomo said New York was hurt by federal negligence that allowed COVID-19 to come here from Europe. “New York was ground zero,” he said. “We demand fairness.”
Schumer and Gillibrand said the SALT deduction is unfair to New Yorkers for several reasons:
• New Yorkers already subsidize other states by paying $36-45 billion more in taxes than we receive back from the federal government.
• The repeal of the SALT deduction results in double taxation by imposing federal taxes on the income used to pay state and local taxes.
• The elimination of the deduction drives wealthier 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.
