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Schumer Pushes to Add SALT Cap Repeal to Latest Stimulus Package

Posted on July 16, 2020

U.S. Senate Minority Leader Charles E. Schumer, D-N.Y., and Rep. Tom Suozzi, D-N.Y., have announced a plan to repeal the state and local tax deduction cap in an upcoming federal coronavirus relief package.

At a news conference in Long Island, New York, Schumer said he would “push to insert language the House passed, and Rep. Suozzi . . . authored, to restore our full SALT deduction in the upcoming coronavirus legislation under negotiation right now,” according to a July 14 release.

House Democrats in May passed the Health and Economic Recovery Omnibus Emergency Solutions Act (H.R. 6800), which includes a provision to repeal the SALT deduction cap for two years. Senate Republicans said at the time that the relief package would be dead on arrival in that chamber.

According to the release, the $10,000 SALT deduction cap enacted under the federal Tax Cuts and Jobs Act affects nearly half of Long Island’s taxpayers and about 44 million Americans who had claimed the full deduction.

“We need to bring our federal dollars back home and cushion the blow this virus — and this harmful SALT cap — has dealt so many homeowners and families locally,” Schumer said.

“Without the full SALT deduction, families will leave New York, and the last thing we need in the midst of the health and economic devastation of coronavirus is to lose our residents and taxpayers,” Suozzi said.

Schumer acknowledged that the plan would be difficult to pass, given the opposition of Senate Majority Leader Mitch McConnell, R-Ky., but he argued that doing so would restore fairness and “put an average of about $20,000 across almost 700,000 households back into the Long Island economy.”

Suozzi and Schumer also said the cap results in double taxation and places a bigger tax burden on middle- and lower-income taxpayers.

Besides joining with other states to litigate the provision's constitutionality, New York Gov. Andrew Cuomo (D) has repeatedly called for a repeal of the SALT cap, arguing that it would help his state and others affected by revenue shortfalls related to the COVID-19 pandemic.

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