Democrats Want Tax Cuts for Their Rich
They’re still fighting to restore bigger SALT deductions for wealthy folks in blue states.
Tax cuts for the rich.
That’s all we hear from Democrats when Republicans try to lower taxes. Predictably, when former President Donald Trump signed major tax reform legislation that included a cap on state and local tax deductions from federal taxes in 2017, Democrats began sweating.
“Tax the rich, tax the rich, tax the rich,” New York Governor Andrew Cuomo famously said. “We did. Now, God forbid the rich leave.”
Sure enough, as day follows night, they’re leaving.
That’s because Democrat-run states generally have the highest taxes, and the cap limited SALT (state and local tax) deductions at $10,000. That means the wealthiest residents of places like New York and California had to fork over a lot more in taxes to Uncle Sam. Some of them put their homes up for sale and fled to tax-free states like Florida and Texas.
Now, Democrats in these states want to repeal the SALT cap and stick lower-income red-staters with the subsidy bill.
New York Senators Chuck Schumer and Kirsten Gillibrand introduced legislation in January that would eliminate the cap. Other Democrats are lining up in support of the proposal, and they’re trying to wedge it into every unrelated bill they can think of.
In other words, Schumer and company want a big, fat tax cut for the rich.
Democrats are so desperate to get rid of the SALT cap, they’re threatening to hold up President Joe Biden’s multitrillion-dollar infrastructure plan.
“The Democratic enthusiasm for this tax cut has two sources,” the editors at National Review Online write. “It disproportionately benefits not just high earners but high earners in high-tax, which is to say liberal and Democratic-run, jurisdictions: the kind of people who fund Democratic campaigns everywhere. It also makes it easier for state and local governments to maintain high levels of taxation: Taxpayers in other parts of the country pick up some of their burden. Public-sector unions are, for that reason, also enthusiastic about the deduction.”
Sounds like a great plan for all the groups that support Democrat politicians. After all, why come up with ways to make government more efficient, control spending, and allow more middle-class people to keep the money they earned when you can cozy up to Big Business and continue to make government bigger?
CNBC reports, “Kathryn Wylde, president and CEO of the Partnership for New York City, with hundreds of members that represent businesses across the city, told CNBC that Schumer addressed the need to bring back the SALT deduction during a Friday virtual fundraiser for his reelection bid.” Members of the partnership include big names such as “JPMorgan CEO Jamie Dimon, BlackRock CEO Larry Fink, Citigroup CEO Jane Fraser and Blackstone CEO Steve Schwarzman.”
Schumer harshly criticized the 2017 GOP tax plan that capped SALT deductions, but his own plan would line the pockets of the very wealthiest New Yorkers while leaving middle-class residents of other, more fiscally responsible states with the bill.
The Committee for a Responsible Federal Budget concludes, “The retroactive change would cost over $130 billion, and repealing or loosening it for this and/or future years would cost substantially more. About half of the dollar value of the tax cuts would flow to households making over $1 million. Less than 6 percent of the benefit would go to taxpayers making under $200,000, and only 0.5 percent would go to those making under $100,000.”
The push to remove the SALT cap is just another example of Democrats claiming to represent the interests of the working class. In reality, they’re the party of Big Business and Big Government.
And they want the rest of America to pay for it.
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