What the hell? In the mad scramble to re-re-rewrite the huge “Build Back Better” social-spending bill and rush it to a vote, Speaker Nancy Pelosi inserted a huge tax cut for the rich.
That’s right: The plan now is to raise the cap on state and local tax deductions for federal income taxes, otherwise known as SALT. The 2017 Trump reforms capped it at $10,000; Pelosi would raise that to $72,500 in 2021, then gradually to $80,000 over the next decade.
Per the Tax Foundation, this means a tax cut for more than 70 percent of US households making over $200,000, with those earning over $500,000 reaping the most benefits.
Why? Because Democrats from high-tax states, not least Senate Majority Leader Chuck Schumer, knows that the Trump limit makes high earners feel the full pain of living in high-tax states like New York — and so encourages them to move out, taking their entire tax bill with them.
Better, reason Schumer and Cali’s Pelosi, to reduce federal revenue from these high earners than to force state legislators to ease up their rates.
Meanwhile, the bill hits the middle class hard: The left-leaning Tax Policy Center says 74 percent of middle-class households will pay more as corporate tax increases get passed to consumers and employees.
If this passes, AOC will need to burn her “tax the rich” dress.
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