N.Y. in appeal of Trump tax grab
ALBANY — New York and three other states are appealing a federal court ruling that struck down their lawsuit against the Trump administration’s $10,000 cap on tax deductions for state and local taxes, commonly known as SALT.
Gov. Cuomo and Attorney General Letitia James announced Tuesday that the state, joined by Connecticut, Maryland and New Jersey, will appeal the September dismissal of their suit charging the SALT reform, a component of the GOP’s 2017 Tax Cuts and Jobs Act, targeted states with large Democratic majorities.
“The Trump administration’s SALT policy is retribution politics — plain and simple,” Cuomo said. “New York is already the nation’s leader in sending more tax dollars to Washington than we get back every year, and we will not allow this administration to pick the pockets of hardworking New Yorkers to fund tax cuts for corporations and send even more money to red states. We will continue to fight this unconstitutional assault until it is repealed once and for all.”
The original suit, filed last year, claimed that the cap was unconstitutional and infringed on states’ rights.
U.S. District Judge Paul Oetken disagreed. He tossed the suit, deciding that “states remain free to exercise their tax power however they wish.”
James argued Tuesday that the law disproportionately harms taxpayers in states where income-tax deductions can easily exceed $10,000 a year and “has already put a heavy burden on the hardworking, middle-class families of New York.”
“New York will not be bullied into paying more in taxes or changing its vital public investments because of Congress and the president’s partisan choices,” she said. James estimates the cap will cost New York taxpayers more than $100 billion in coming years.
A separate suit filed this summer by New York, New Jersey and Connecticut is still winding its way through the court system. That suit defends workarounds blue states have come up with to let residents to write off state and local income and property taxes above the $10,000 limit.