Byrnes: This is politics at its worst. Democrats are using the infrastructure bill as a way to sneak a SALT cap repeal past the American people. I'm surprised anyone reasonable in Congress is even pushing for this in light of the limits that have been placed on stimulus payments for those with even moderate incomes. We're already looking at a proposed law that would hurt the businesses that we should be trying to support. Using those corporate tax hikes to support a tax cut for a group of wealthy Americans seems counterproductive.
Bloink: With the entire country emerging from a crisis, this is no time to single out taxpayers in high-tax states for a tax penalty. This is relief that should have come some time ago, and it is one small way we can help states that have struggled the most. This might look like a political maneuver, but in reality, it's a move that seeks to hold our current president to his campaign promises. The SALT cap has been unpopular among both Republicans and Democrats in high-tax states, and painting this as a Democrat-only issue is simply misleading.
Byrnes: Eliminating the SALT cap would reduce federal revenue streams by billions — an estimated $600 billion, to be precise. It would also favor taxpayers who live in high-tax states at the expense of others who need help just as badly in these times. These members of Congress are trying to manipulate the system so that taxes on one group of discrete individuals are reduced in favor of increasing corporate tax rates that impact the entire economy and motivate corporations to create the jobs that we so desperately need.
Bloink: The SALT cap is an economic penalty that singles out taxpayers in high-tax states and applies to the middle class as well as the rich. Repealing the SALT cap only within certain AGI bands is another option, but it also adds a layer of complexity for taxpayers already struggling to determine which relief they might receive.
Byrnes: Democrats like to raise the inequality issue when arguing for repeal of the SALT cap. Looking at it logically, however, the SALT cap actually introduces more equality into the federal tax code. Eliminating the SALT cap right now offers relief to taxpayers based solely on where they live — favoring taxpayers who live in high-tax states at the expense of others who need help just as badly — if not more — during these times.
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