As Caps on Federal Deductions Begin, High-Tax States Seek a New Scheme
For many, there are few things quite as enjoyable as watching high-tax states kvetch that the new GOP tax plan caps deductions on federal tax returns for state and local taxes.
Taxpayers in other states have long subsidized the spendthrift ways of states like California and New York. Those states could always sell yet another tax increase to their citizens, who knew they could deduct the increase on federal returns.
But those days are over, and high-tax states are scrambling to figure out how to keep having their cake and eating it, too. The New York Times reports: "One proposal would replace state income taxes, which are no longer fully deductible under the new law, with payroll taxes on employers, which are deductible. Another idea would be to allow residents to replace their state income tax payments with tax-deductible charitable contributions to their state governments."
This is in addition to efforts to sue the federal government -- as if a federal tax deduction is somehow a right.
However, I do encourage those states to try that "charitable contribution" idea, under the obvious condition that they can't dress up a mandatory tax as a charitable contribution. Because that's not charity.
What's amusing is that these states don't seem too interested in just cutting their state budgets. Spending less would be heresy to Leftist politicians who embrace a redistribution ideology. Balanced budgets are for other people, but not them.
Many other states are able to prosper without ridiculously high taxation rates. Some states have no income tax at all, and manage to run just fine. Funny how that is.
Frankly, "flyover country" is sick of subsidizing the ever-expanding bureaucracy of states that look down on us with disdain. If the coastal elites want high taxes, then they need to find a way to make that work on their own. Don't ask the federal government to just pass your debt over to the rest of us.
The Times notes: "[T]he cap on the state and local tax deduction could pose a serious threat to state budgets, because it makes state taxes more expensive for residents. That could make it harder for states to raise taxes, particularly on wealthy residents, and could increase pressure to cut spending."
In other words, these state governments are well aware that their own citizens don't want to pay for whatever crap they keep spending on. They've just been shamelessly forcing others to pay for it through deductions.
Now that there's a cap, they'd rather scheme to dump the costs on another sucker than admit their ideas lead to ruin. All the while, the rest of us are sitting here with smirks on our faces, knowing this is going to be a titanic failure. https://pjmedia.com/trending/states-trying-trickery-rather-lowering-tax-rates-amid-new-regulations/
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So then it must be simply hilarious to see Texas go through that then? I guess cheese is going to get a little more expensive seeing as though Wisconsin is right there with California huh?
Since the gop cut our government's income to the bone to the benefit of the richest of the rich and big multi-national corporations huge budget deficients will inevitably result allowing the gop to demand massive cuts to social programs that benefit sick hungry children, the truely disabled, the elderly and those Ameicans who are already politically disadvantaged. This is an olde scheme and a wet dream of the far right which is called "Starve The Beast". Only the biggest corporations and the top 0.1% of the richests fat cats will benefit. The vast majority of Americans will have to work harder, pay more and expect a lot less. The trap is set and we have really stepped in it this time by giving the gop the reigns to all branches of our government. Once Citizens United allowed multi-national corporations to purchase our sacred Republic...They Did!
Red states are filled with welfare queens that don't work, don't pay taxes and soak up federal money while blue states have to pay in more to cover for their broke ass's. California has the 6th largest economy in the world, it literally carries the top 9 broke ass red states. Maybe red states should learn basic math and stop lowering taxes and spending far more than they take in. It's really not that hard.
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I do love the comments here, "it's the blue states fault that red states are broke!". Pathetic. Without the blue states the red states would cease to exist.
It's a good start. Federal, state and local taxes should be totally separate. It's wrong to allow some to offset what they owe to the feds by keeping it local.