Gottheimer: Elimination of SALT Deduction Would Hurt NJ First Responders

PATERSON, N.J. – Today, Congressman Josh Gottheimer (NJ-5) stood with Congressman Bill Pascrell (NJ-9) and first responders in Paterson to highlight the painful effects that the elimination of the state and local tax (SALT) deduction would have on New Jersey public safety. By further disproportionately shifting hard earned New Jersey dollars out of state and increasing incentives to move, local communities and their services will come under severe budgetary pressure, resulting in the gutting of staff, training, equipment for first responders.

Said Congressman Josh Gottheimer (NJ-5), “If the moocher state taxwriters in Washington get what they want and eliminate this critical deduction, our taxes are going to spike, our businesses and jobs are going to disappear, our towns will suffer, and they’ll be pressed to cut our public safety services. Our firefighters. Our police. Our first responders. Eliminating this deduction will take the money for these services and send these dollars to South Carolina and Mississippi,” said Gottheimer. “I’m prepared to support the right tax bill. But it must be the right tax reform. It must be bipartisan, it must cut taxes for New Jersey. It must be pro-business. It must be pro-police and pro-firefighters.”

Video of his remarks can be found HERE.

Below: Congressman Gottheimer’s remarks as prepared for delivery.

Congressman Pascrell and I are here today to stand up and defend New Jersey from the latest onslaught – from those who, once again, want New Jersey to be America’s piggy bank.

Before we start with anything, let me reiterate this point: I want tax reform. I want a simpler tax code and lower taxes. Our taxes are too high and our seventy-five-thousand-page tax code requires a PhD to understand.

Today, I am here to say yes to lower taxes, but no to getting there on the backs of our residents, our towns, our first responders – and no to getting there by eliminating the state and local tax deduction. As it stands, because eliminating this deduction will prevent us from deducting our property, state, and local taxes, New Jersey taxpayer’s tax bills will go up $3,500 a year and, according to studies, housing prices will go down at least ten percent. Beyond that, it will give a huge competitive advantage to payee states like Mississippi – or what I call Moocher States – over states like ours that pay far more in federal taxes every year than they get back.

In other words, this is yet another huge wealth transfer payment from payer states like New Jersey and New York – from our citizens — to the Moocher states. We are literally subsidizing other states – their roads, their bridges, their lower taxes…

And we’re subsidizing their local governments at the expense of our own police and fire fighters! At the expense of the safety of our families from the threat of crime and lone wolf terrorists.

As Co-chair of the bipartisan Problem Solvers Caucus, I have been on the frontlines of finding reasonable tax solutions, with my colleagues from both sides of the aisle. New Jersey is one of the top tax paying states in the nation, which is why I’ve been pushing for years to cut taxes for residents and for businesses of all sizes. But it can’t happen at the expense of the people keeping our communities safe. That’s where I draw a line in the Jersey Sand.

The Moocher States and their representatives want to tap our pocketbooks us again by killing the state and local tax deduction – a provision that has been around since 1913. It’s a joke. It’s one of the last remaining tools we have to bring some of our tax dollars here, funding the critical work of our first responders. That’s why Rep. Leonard Lance and I have introduced new legislation – the “Return on Investment Accountability Act,” our Anti-Moocher bill – that will address this disparity in federal spending and taxes in the states while keeping Federal dollars in the hands of those who serve and protect.

My District is already one of the top three percent tax paying districts in the entire country – way too high. Yet, as you can see on the Moocher Map, we only get back 33 cents for every dollar we send to Washington. Compare that to West Virginia: $4.23, Alabama: $3.14, South Carolina: $2.82, and Mississippi: $4.38.

The math is simple. In New Jersey’s 5th District, 43% – nearly half – of our taxpayers use the SALT deduction. Those taxpayers deduct an average of $18,535 in SALT. 53% of New Jersey households claiming the deduction make between $75,000 and $100,000. This provision – as it’s currently written – literally ties our hands behind our back and throws us in the Hudson. Eliminating the states and local tax deduction is like putting on a pair of cement shoes.

I stand here today because, at my core, I believe our community – and your elected officials, regardless of party — have an obligation to do everything in their power to look after first responders, who put their lives on the line every day to keep our families safe.

But if the moocher state taxwriters in Washington get what they want and eliminate this critical deduction, our taxes are going to spike, our businesses and jobs are going to disappear, our towns will suffer, and they’ll be pressed to cut our public safety services. Our firefighters. Our police. Our first responders. Eliminating this deduction will take the money for these services and send these dollars to South Carolina and Mississippi.

Bill and I are here today, because we want to make it more affordable to live and run a business in New Jersey. And we want to make New Jersey safer. And we want to make sure our police and fire fighters are well-equipped. But this provision will make that impossible.

We came here because you all have always had our backs. You need to know that we will have yours.

Bill here truly is one of the hardest fighters for first responders in Congress.  In fact, as the chairman of the firefighters caucus – which I’m a proud member –  he’s been supporting our brave first responders since his first days in Washington.  He and I have fought, and will continue to fight, for all of the resources at our disposal — for any existing grant that can help first responders. From counterterrorism grants to BYRN and COPS grants to SAFER and FIRE grants—these programs help properly equip and staff our first responders and bring home our dollars, increasing our return on investment.

I will always work to get our first responders every resource they need to do their job, and I will be the first person to stand in the way of people trying to cut costs on the backs of our police officers and fire fighters

So, I’m eager to see the final plan next week hopeful that folks come to their senses and stop taking shots at those states like ours that are already paying the heavier load.

I’m prepared to support the right tax bill. But it must be the right bill for New Jersey. It must be bipartisan, it must cut taxes for New Jersey. It must be pro-business. It must be pro police and  pro-fire fighters.

Thank you and God bless you.

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