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7 Democratic governors urge Biden to lift Trump-era $10K cap on tax deductions, saying the 'assault' costs their constituents billions of dollars

 Seven Democratic governors on Friday called on President Joe Biden to lift the $10,000 cap on state and local tax deductions that was a part of former President Donald Trump's massive 2017 tax law, arguing the 'assault' disproportionately targeted Democratic-run states and ultimately increased taxes on families.

The letter comes a little more than a week after U.S. Treasury Secretary Janet Yellen agreed to work with Congress on a way to remedy the 'inequities' the cap has caused.

The governors of Connecticut, New Jersey, California, Hawaii, Illinois, New York and Oregon spelled out in a two-page letter how their constituents are paying billions of dollars annually in additional taxes to the federal government. 


It's roughly $12 billion more in California and in New York; approximately $3 billion in New Jersey; $370 million in Hawaii, and $1.3 billion in Connecticut, which pays more into the federal government while receiving back less per capita than any other state, according to the letter.

President Joe Biden is being asked to lift the $10,000 cap on tax deductions by seven Democratic governors

President Joe Biden is being asked to lift the $10,000 cap on tax deductions by seven Democratic governors 

Treasury Secretary Janet Yellen has said she is willing to work with Congress on the issue

Treasury Secretary Janet Yellen has said she is willing to work with Congress on the issue


'This assault disproportionately targeted Democratic-run states, increasing taxes on hardworking families,' the letter reads. 'This was unacceptable then, and is simply untenable given the dire economic conditions caused by the pandemic.'

The governors said they were heartened to hear Yellen's willingness to work with Congress to ease the impact of the $10,000 cap and urged Biden's administration and Congress 'to continue these efforts to relieve this immense financial burden on our residents and eliminate the SALT cap entirely.'

Yellen gave the governors some hope earlier this month when she responded to a question from New Jersey U.S. Rep. Josh S. Gottheimer, a Democrat, during a March 23 hearing before the House Financial Services Committee. 

New York Governor Andrew  Cuomo
California Governor Gavin Newsom
New Jersey Governor Phil Murphy

The Democratic governors of seven states, including, from left, New York Gov. Andrew Cuomo, California Gov. Gavin Newsom and New Jersey Governor Phil Murphy, have written to Biden to urge him to lift the 2017 Trump-era limit

Connecticut Gov. Ned Lamont
Illinois Gov. J.B. Pritzker
Hawaii Gov. David Ige

The governors, including Connecticut Gov. Ned Lamont, Illinois J.B. Pritzker and Hawaii Gov. David Ige, argue that the cap costs their constituents billions of dollars

The letter also was signed by Oregon Gov. Kate Brown

The letter also was signed by Oregon Gov. Kate Brown

Gottheimer asked if the Biden administration would support eliminating the SALT cap and reinstating the popular tax deductions for state and local taxes, calling the current situation a 'misguided policy of double taxation.'

Yellen said she agreed the cap has led to 'disparate treatment,' but did not commit to eliminating it entirely.

'There are a lot of options that have been presented,' she said, noting that in addition to a bipartisan proposal to the remove the cap, Biden has discussed possibly capping itemized deductions at 28%.

'The caps could be increased,' she said during the hearing. ' So I think we need to study just what impact it's had and (I) look forward to working with you to find a fair way to address it.'

2 comments:

  1. With a $10,000 cap the only ones suffering are the rich M'fers. These 7 states represent the worst of the demon states. I am surprised the idiot from MN wasn't a part of that group.

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  2. The Corporate elites in these Blue states suck wealth out of the whole nation. The Federal taxes collected from them belong to all US citizens and so it is right for them to be redistributed nationally. These Blue states want to use greater deductions for their higher State and Local taxes to steal money back from their fellow Americans. The Democrats purport to believe in all sorts of Left wing ideals, but what they really believe in is Government of the Rich People, by the Rich People, for the Rich People

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