Mikie Sherrill and ‘the Summer of SALT’
How’s the “Summer of SALT” going?
That name may not inspire excitement, but that’s what Mikie Sherrill is calling the summer of 2021 and her battle to remove the $10,000, federal cap on state and local tax (SALT) deductions.
The issue is not new.
The cap was created by the 2017 tax reform bill and many New Jersey politicians from both parties have called for getting rid of it.
The problem obviously is more acute in such places as New Jersey where many people pay more than $10,000 in property taxes alone.
Sherrill said in a virtual town hall tonight that it looks like removing the cap will be included in an infrastructure bill now being debated. But it’s not that simple.
She said the reconciliation process likely will be needed to pass the bill to remove the cap. That means passing the bill with 51 votes in the Senate. The vice-president may be needed to break a tie.
“I am very supportive of the bipartisan tract we are seeing,” she said, referring to the House where there is actually a SALT caucus.
Sounds good, but suppose the infrastructure bill, which is an administration priority, ends up not including eliminating the cap?
Sherrill was asked what she would do then?
The congresswoman said she’s confident that Congress can do both, adding that she doesn’t see a “pathway” to passing an infrastructure bill through the reconciliation process if it doesn’t include eliminating the SALT cap.
Deep blue states such as New Jersey have grown their state budgets in large part over the years by utilizing the deduct-ability of state and local taxes from federal income taxes.
The problem arises in that federal taxes still have to be paid to cover federal expenses so now the day of reckoning has come where these states & municipalities can no longer continue the status quo of always growing their government.
I don’t think the state of New Jersey nor it’s municipalities have a revenue problem, I think the state of New Jersey and it’s municipalities has an expense problem. And these deep blue politicians will do everything they can to avoid making cuts to the expense line it is anathema to them.