Nobody wants to relieve the middle class tax plight more than I, but as people debate the Republican tax plan, let’s look at the big picture in perspective.
Our Congressman, Lee Zeldin, states, “I believe that the state and local tax deduction should stay entirely. There are some people who want to eliminate the state and local tax deduction entirely. I sure hope that there is a sweet spot. I would love to get to yes.”
THERE IS NO SWEET SPOT! There should be no compromise on state and local tax deductibility – it is no more than targeted wealth transfer away from New York and California. FURTHER, the Republican tax plan is a strong no from every point of view, not just state and local tax.
The issues with the tax plan go deep. It is a reprioritization of America’s goals through the tax code, and a transfer of wealth from large states to small ones, with a relatively small middle class tax cut sprinkled in for cover (and even this “cut” is actually a tax increase for many middle class groups). In the name of “simplification” the tax plan eliminates virtually all deductions and incentives. But these “complications” in the tax code are materially a good thing. The US tax code “rewards” certain actions and behaviors. This is an important part of how we function as a society, and to take them out will make us a much lesser nation. Do we really want these revisions to the tax code?
- Eliminate deduction of interest on student loans – the deduction makes college more affordable for the middle class
- Eliminate deductions of medical expenses – the deduction lessens the blow of paying for significant medical hardship
- Eliminate deductions of critical nursing home costs – the deduction makes it easier for our elderly to be cared for
- Add an excise tax on university endowments – this will make it more expensive for our higher education institutions to function and make college more expensive for the middle class
- Eliminate the credit for adoptions and include adoption assistance funds in employee income – this will make adoptions more expensive
- Eliminate the New Market Tax Credit – the change will cancel a program that supports public-private partnerships that have created over 750,000 jobs in poorer towns throughout the US
- Eliminate the moving expense deduction – the deduction softens the blow of relocation costs when an employee loses his job and must move to find new work
- Eliminate the credit for employer providedchild care – this will make it more expensive for two-earner families to raise their children
- Eliminate the Work Opportunity Tax Credit – a subsidy for certain groups who have historically and consistently faced barriers to employment
- Limit the home interest deduction – this will increase the cost of living for middle class families in high cost areas such as Long Island and reduce our property values
- Make dark money tax deductible by eliminating the Johnson Amendment – this will allow groups like the Koch brothers to donate to churches, deduct the donation, and permit the church to provide political contributions with those funds, untraceable to the Koch brothers.
- And most of all, the tax bill generally provides almost all of its cuts to high income earners, while the income tax on many middle class wage earners will go up
So Representative Zeldin, putting state and local deductions aside, is this really a good plan? For New Yorkers? For the middle class? For families? For people trying to get educated or care for the elderly? Or simply make our society a little more just?
When I am elected to Congress, I will fight to protect the middle class and improve their tax burden, but I will do so without a massive wealth transfer to the least needy. And I will fight to preserve the good elements of the current tax code cited above.
By Perry Gershon