WASHINGTON — Most lawmakers in New York, both Democrats and Republicans, quickly objected to the removal of the federal tax deduction for state and local taxes in the tax overhaul framework announced by President Donald Trump Wednesday.
Joining them were politicians from high property-tax states such as New Jersey, Connecticut and California, creating a stumbling block for the new framework over the measure meant to help raise revenue for other tax cuts.
“It’s clear people on Long Island would definitely lose under this tax reform,” said Rep. Peter King (R-Seaford), who has joined other New York lawmakers in lobbying Republican leaders and the president on the issue. “That deduction is really essential.”
Backers of the framework said the loss of the state and local tax deduction would be covered by the plan’s doubling of the exemption for single filers to $12,000 and to married taxpayers filing jointly to $24,000, and increase in child tax deductions.
But that may not cover the taxes, King and other politicians said.
“Take Long Island. You have a family — it’s a teacher and a police officer — their income’s about $150,000. But they pay, between their property tax and their income tax, a lot,” said Sen. Chuck Schumer (D-N.Y.). “If they don’t get the deduction, doubling the standard deduction is not going to make up for or come close to it.”
The Long Island Association, a business advocacy group, praised the frameworks’ cutting of corporate taxes but said scrapping the state and local tax deduction “would cost Long Islanders more than $2.5 billion.”
The average amount of real estate taxes claimed by Long Island filers with adjusted gross incomes under $200,000 was nearly $10,000 in 2015, an analysis of IRS tax data shows. Adding in Long Island taxpayers with higher incomes bumped up the amount to $23,375.
“I would challenge it as double taxation,” said Gov. Andrew Cuomo. “It is a pure tax increase, this from the patron saints of lower taxes.”
Most Long Island representatives to the House also objected. Rep. Tom Suozzi (D-Glen Cove) said it would be “a tremendous burden to those who live in Nassau County.” Rep. Kathleen Rice (D-Garden City) posted a tweet that called it a “Non-starter for #NY04.”
Rep. Lee Zeldin (R-Shirley) said he would assess “whether or not, and how, to maintain the State and Local Tax Deduction” to ensure it’s “not just good for America” but also his district.
With Emily Ngo and Laura Figueroa