Pascrell Demands SALT Cap Removal

Pascrell Demands SALT Cap Removal

Hearing highlights destructive GOP tax scam, corrective Pascrell legislation

WASHINGTON, DC – U.S. Rep. Bill Pascrell, Jr. (D-NJ-09), New Jersey’s only member of the tax-writing House Ways and Means Committee, today spoke at a hearing of the House Ways and Means Subcommittee on Select Revenue Measures, “How Recent Limitations to the SALT Deduction Harm Communities, Schools, First Responders, and Housing Values.” Pascrell assailed the Republican tax scam of 2017 and how its capping of the State and Local Tax Deduction, or SALT, has harmed middle-class New Jerseyans and communities. Pascrell also discussed his legislation, H.R. 1142, which would remove the onerous SALT caps.

“We need a fix, and I have one. My bill, H.R. 1142, would bring back the full SALT deduction – and it’ll do it by restoring the top individual tax rate on top earners,” Rep. Pascrell said. “The Joint Committee on Taxation estimates that this provision would raise about $217 billion over 10 years. We have 46 bipartisan cosponsors currently and momentum is growing behind it.”

The hearing today comes after Pascrell and his colleagues have repeatedly called for removing the caps imposed on SALT by the Republican tax scam of 2017. Rep. Pascrell has been a leading a critic in Congress of the Republican tax scam and has repeatedly assailed the capping of the SALT deduction.

Pascrell is the lead sponsor of H.R. 1142, the bipartisan Stop the Attack on Local Taxpayers Act of 2019, which would remove the SALT cap. It is currently cosponsored by 45 House members. Companion Senate legislation, S. 437, is sponsored by Sen. Robert Menendez (D-NJ) and currently cosponsored by 13 senators.

A clip of Rep. Pascrell’s statement is available here. The full text of his written statement is provided below:

The Honorable Bill Pascrell, Jr.

Testimony Before the

House Ways and Means Subcommittee on Select Revenue Measures

June 25, 2019

 

I am pleased to participate in this important and long-overdue hearing on the impact that capping the SALT deduction has had on our communities. It is high time we shed sunlight on the kneecapping of SALT by the Republican tax scam of 2017.

 

The SALT cap is a double tax that is devastating my home state of New Jersey. In my whole career, I’ve never seen such punitive tax policy. It was literally designed to pit states against each other. Republicans made it a battering ram to target places that didn’t vote for them.

 

There are those who say SALT is for the rich. That’s 100% poppycock.  Last year, half of the population in New Jersey lived in middle-income households. Capping the SALT deduction hurt these middle-class families. Every county in New Jersey except for one has an average SALT deduction over the new $10,000 limit, with 80 percent of the households making under $200,000. The average in Bergen County, which I represent, was close to $25,000!

 

And when we’re talking about the damage, we need to look beyond individuals. This is important and often missed. Because capping SALT is bad for our communities.

 

For generations, the SALT deduction has given localities – counties, cities, and towns – flexibility to generate revenue streams that fund critical public services. I’m talking about education, about first responders, about housing in places like Paterson or Newark. These are working class or poor communities that rely on SALT savings to provide services.

 

So to people who say SALT is about the wealthy, my answer is you don’t know what you’re talking about. When Republicans capped SALT what they did was hold a gun to the temple of these communities. Cut services or go bankrupt. The tax scam has forced not just taxpayers but communities too into brutal decisions. And nobody wins except the one percent who pocketed these bounties.

 

I hear enough disingenuous criticism from the other side to choke a whale. But it wasn’t our party that forced through a gargantuan tax scam without so much as a hearing! It wasn’t our bill that sent 81% of their tax benefits (by 2026) to the wealthiest Americans and corporations!

 

We need a fix, and I have one. My bill, H.R. 1142, would bring back the full SALT deduction — and it’ll do it by restoring the top individual tax rate on top earners. The Joint Committee on Taxation estimates that this provision would raise about $217 billion over 10 years. We have 46 bipartisan cosponsors currently and momentum is growing behind it.

We know the cap has a marriage penalty, and the cap does not rise with inflation. Some proposals address these specific issues. But we need more than a band-aid. I strongly believe the House must pass a full repeal.

 

Taxpayers know SALT’s importance. Members in high-tax states who spearheaded this provision – including a couple who served on our very committee – were replaced in-part because of boiling voter frustration. I know my four new Democratic colleagues from New Jersey agree that addressing SALT is a top priority.

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