Gov. Andrew Cuomo and Sen. Chuck Schumer (D-NY) are once again warning that New Yorkers will be hurt if the Republican tax overhaul plan in Congress is approved.
Schumer, who is Senate Democratic Leader, says while the tax plan has changed from the original version, 71 percent of the deductions that now benefit state residents would be eliminated. The plan would end deductions for state and local income taxes, and cap the property tax deduction at $10,000 a year.
“The plan will increase taxes on New Yorkers by $16 billion,” Schumer said in a joint conference call with Cuomo.
Cuomo says the plan would undo seven years of work that his administration has done to keep taxes and spending steady in New York.
“President Trump said this is a Christmas gift,” said Cuomo. “If it's a Christmas gift, New York gets a lump of coal from Santa Trump on this one.”
Cuomo and Schumer are calling on four New York Republican House members, Claudia Tenney (R-New Hartford), John Faso (R-Kinderhook), John Katko (R-Camillus) and Elise Stefanik (R-Wilsboro), who have all expressed reservations about the provision, to vote against the tax plan.
Katko says he has not decided yet whether he will support the bill or not, but has said he would like to negotiate with GOP leaders to bring more help to middle class New Yorkers. But, Katko says the bill doesn’t necessarily have to be bad news for New York taxpayers. He says that’s the case if you take into account an increase in the personal deduction included in the bill.
“You itemize your state and local taxes as well as your interest, and even if you do that, it doesn’t amount for the vast majority of people in this district, especially the middle class, it doesn’t amount to more than $24,000 for a family of four,” Katko said Monday. “So the standard deduction is going to be better. On top of that there’s child tax credits and family tax credits so overall, it looks like it’s going to be a net benefit.”
Tenney says she likes certain aspects of the reform, for example cuts in estate taxes. But she says the wholesale elimination of the deductions would have a devastating impact.
“I’d like to find a middle ground to phase it out, so New York has a chance,” Tenney said Monday. “We just can’t change this January 1. You’re going to see a mass out migration of people, especially high earners keeping the 39, 39.5 percent rate.”
Schumer and Cuomo also urge the proposal’s supporters, GOP congressman Chris Collins and Tom Reed, to change their minds. The Democrats say the plan would lead to tax increases for many of the Congress members’ constituents.
Reed fired back and Cuomo and Schumer, saying in a statement Monday that the two “are throwing everything but the kitchen sink in a desperate attempt to protect their rich friends in New York City." Reed said "The truth is that the compromise on the state and local property tax will protect 99 percent of taxpayers upstate.”
President Trump has said he wants a vote on the tax overhaul package by Thanksgiving.