{"id":241606,"date":"2021-05-04T00:01:00","date_gmt":"2021-05-03T21:01:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/the-fight-over-salt-is-heating-up-whats-next\/"},"modified":"2021-05-04T00:01:00","modified_gmt":"2021-05-03T21:01:00","slug":"the-fight-over-salt-is-heating-up-whats-next","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/the-fight-over-salt-is-heating-up-whats-next\/","title":{"rendered":"#\n  The fight over SALT is heating up. What\u2019s next?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a34d4e62e284\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a34d4e62e284\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/the-fight-over-salt-is-heating-up-whats-next\/#In_such_a_polarized_country_its_no_wonder_state_and_local_taxes_are_so_combative\" >In such a polarized country, it\u2019s no wonder state and local taxes are so combative<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/the-fight-over-salt-is-heating-up-whats-next\/#Andrea_Riquier\" >Andrea Riquier<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong>#<br \/>\n  The fight over SALT is heating up. What\u2019s next?<br \/>\n<\/strong>&#8221;<\/p>\n<h2 class=\"article__subhead\" itemprop=\"alternativeHeadline\"><span class=\"ez-toc-section\" id=\"In_such_a_polarized_country_its_no_wonder_state_and_local_taxes_are_so_combative\"><\/span>\n  In such a polarized country, it\u2019s no wonder state and local taxes are so combative<br \/>\n<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><\/p>\n<div class=\"column column--full article__content\">\n<div class=\"article__side\">\n<div class=\"container--sticky not-active\">\n<div class=\"cx--next\">\n              <\/div>\n<\/p><\/div>\n<\/p><\/div>\n<div id=\"js-article__body\" class=\"article__body article-wrap at16-col16 barrons-article-wrap\" itemprop=\"articleBody\" data-sbid=\"WP-MKTW-0000254847\">\n<div class=\"barrons-article-ad-wrapper\">\n<div data-track=\"barrons-article-ad-wrap\" class=\"barrons-article-ad sticky_item\">\n<div class=\"barrons-main-article-ad-target sticky_target body_ad\" aria-hidden=\"true\"><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>       In 2017, when a Republican-led Congress made a tax policy more restrictive, New York Governor Andrew Cuomo, a Democrat, called it \u201can economic dagger aimed at the heart of New York.\u201d Several months later, New York and three other states <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.governing.com\/archive\/gov-federal-tax-law-lawsuit-states.html\" class=\"icon none\">unsuccessfully sued the federal government<\/a> over the change.<\/p>\n<p> At issue was the state and local tax deduction on federal returns, which was c<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>ed at $10,000 as part of the Tax Cuts and Jobs Act. Taxpayers in higher-cost areas like New York, California and Illinois had long depended on the ability to deduct such taxes \u2014 and the mostly Democratic states where they live had budgeted based on that deduction, as well.<\/p>\n<div class=\"paywall\">\n       The cap was \u201ca clear and politically motivated punishment of blue states,\u201d said New Jersey Governor Phil Murphy, also a Democrat, at the time, \u201cwho already pay far more to the federal government than we receive.\u201d<\/p>\n<p>Now the deduction, familiarly known as \u201cSALT,\u201d is back in the spotlight. Multiple blue-state representatives have recently announced they\u2019ll withhold support from President Joe Biden\u2019s infrastructure spending bill, legislation they\u2019d normally favor, unless the $10,000 cap is repealed, even as policy analysts increasingly acknowledge that the deduction\u2019s moment might have passed. <\/p>\n<p>If all politics is local, and the proceedings in Washington are taking place in one of the most fractious moments in American history, then changes to the tax code that pit geographic areas against each other in a way that can feel zero-sum is perhaps the natural consequence. <\/p>\n<p>\u201cI\u2019m surprised that it just continues to come up,\u201d said Tracy Gordon, acting director of the Urban-Brookings Tax Policy Center. \u201cIn Washington there seems to be this broad consensus that repealing it would be a bad idea and yet people in affected areas feel it in a visceral way.\u201d<\/p>\n<p>A \u201cbad idea,\u201d analysts say, not only because it would result in a loss of revenue, of about $100 billion this year, <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/itep.org\/what-to-expect-from-biden-and-congressional-democrats-on-tax-increases-for-individuals\/\" class=\"icon none\">according to the Institute on Taxation and Economic Policy<\/a>, but because of the optics of the situation.<\/p>\n<p>\u201cWe live in very polarized times, with high income inequality,\u201d Gordon said in an interview. \u201cThe fact that this predominantly affects people at the top and in very blue states gets peoples\u2019 attention on both sides. Some folks feel targeted by (the 2017 tax changes) and some would say those people are just complaining.\u201d<\/p>\n<p>It\u2019s also unavoidable that the same states claiming the cap has caused hardship are those that appear to have done well through the COVID crisis: their larger share of white-collar workers have been able to work remotely, a larger share of people with a greater stake in the stock market\u2019s<br \/>\n        DJIA,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/210598065\/realtime\" class=\"positive\">+0.70%<\/bg-quote><br \/>\n       fortunes have been lucky, and so on, Gordon pointed out. There is also not much evidence that substantial numbers of higher earners have left higher-tax states as a result of the cap \u2014 at least so far.<\/p>\n<p><strong>Read next:<\/strong> State of the States: Are rainy days here again? In four charts, the pandemic\u2019s pain<\/p>\n<div id=\"cx-membership-tile\"><\/div>\n<p>Despite that, it\u2019s also the case that higher earners in higher-cost areas may have more of their wealth wrapped up in their homes, and may feel more \u201cmiddle-class\u201d than wealthy, said Garrett Watson, a senior policy analyst with the Tax Foundation.<\/p>\n<p>The Tax Foundation calls itself \u201cindependent,\u201d but <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">media<\/a> reports often describe it as center-right, while the Tax Policy Center, Gordon\u2019s organization, is often labelled left-leaning. On SALT issues, however, there\u2019s a great deal of consensus. <\/p>\n<p>For his part, Watson is watching not just the specific maneuverings around SALT, but also the broader landscape within which it lives.<\/p>\n<p>Between additional tax-law changes that are being discussed, like capital gains tax hikes, as well as more generous support from the federal government, SALT might be better discussed as part of a holistic package, Watson told MarketWatch.<\/p>\n<p>There are several compromise measures floating around, including <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.collins.senate.gov\/newsroom\/senator-collins-introduces-legislation-fix-unfair-tax-penalty-married-americans\" class=\"icon none\">doubling the cap to $20,000 for married couples<\/a>, or imposing income limits on the deduction, Watson said. \u201cDo folks who support removing the cap feel comfortable with that kind of compromise?\u201d<\/p>\n<p>The cap is due to become permanent in 2025, he noted, so some of the jockeying going on now may have that date in mind. And while SALT may always be a lightning rod, Watson and other tax-watchers think the time might be right for some big-picture changes.<\/p>\n<p>\u201cThere\u2019s a lot of discussion, but hidden within it is an opportunity to talk about reform,\u201d he said. \u201cThere is a lot of opportunity for simplicity there.\u201d<\/p>\n<p>Traditionally, tax policy has been considered in the context of its impact on taxpayers, not regions of the country, Gordon mused. <\/p>\n<p>\u201cThe federal tax system is not indexed for higher cost-of-living places,\u201d she said. \u201cSALT and the mortgage-interest deduction helped incentivize people to live there. They were a back door subsidy for helping people live there. But high-cost cities like San Francisco or New York City are also places where people are very productive. It\u2019s good for the economy for people to be concentrated there.\u201d<\/p>\n<p><strong>See: <\/strong>What good is a commuter tax in a work-from-home world?<\/p><\/div>\n<\/div><\/div>\n<p><\/p>\n<div class=\"byline article__byline\">\n<p>      <span>By<\/span><\/p>\n<div class=\"author  hasMenu\" data-scrim='{\"type\":\"author\",\"header\":\"Andrea Riquier\",\"subhead\":\"The Wall Street Journal\",\"list\":[]}' itemscope itemprop=\"author\" itemtype=\"http:\/\/schema.org\/Person\">\n<h4 itemprop=\"name\"><span class=\"ez-toc-section\" id=\"Andrea_Riquier\"><\/span>Andrea Riquier<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/p><\/div>\n<\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"http:\/\/www.marketwatch.com\/news\/story.asp?guid=%7B21005575-02D4-D4B5-4572-D3E37FE137C5%7D&#038;siteid=rss&#038;rss=1\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# The fight over SALT is heating up. What\u2019s next? &#8221; In such a polarized country, it\u2019s no wonder state and local taxes are so combative In 2017, when a Republican-led Congress made a tax policy more restrictive, New York Governor Andrew Cuomo, a Democrat, called it \u201can economic dagger aimed at the heart of&#8230;<\/p>\n","protected":false},"author":1,"featured_media":241607,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[],"class_list":["post-241606","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/241606","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=241606"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/241606\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/241607"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=241606"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=241606"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=241606"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}