Rep. Peter King, a staunch opponent to the current version of the House Republicansâ tax reform plan, said the elimination of the state and local tax (SALT) deduction could increase the average New York homeownerâs taxes by at least $1,000.
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âMaybe more than that -- $2,000 to $3,000,â King, R-N.Y., told Maria Bartiromo on âSunday Morning Futures.â âItâs difficult to fully compute it right now, but thereâs no doubt there will be increases.â
King and other lawmakers from high-tax states, which include New York, New Jersey and California, argue that getting rid of these deductions will hurt hard-working, middle- to upper middle-class people. The New York Republican has said that the reason why New York is considered âhigh-taxâ is because much of the revenue that goes to the federal government isnât returned to the state.
âNew York gets $48 billion less from the federal government than it pays in revenues,â he said Sunday. âOther states get almost twice as much back as they put in, so we have to make that up somehow. If we can get that $48 billion back in New York, that would make it a lot easier for us to reduce tax rates.â
King said his region is being treated unfairly since other states will not see such an impact. In nearby New Jersey, Senate President Steve Sweeney said last week that his state, as well as New York and California, are âunder attackâ by conservative lawmakers in the nationâs capital.
âIf we lose the millions of dollars that theyâre talking about and taxes are going to be raised on average families by $2,500 when they lose the deductions theyâre going to get, how can you do anything? Right now we have to re-evaluate where weâre going to go,â Sweeney said during an interview on FOX Business.
Much like Sweeney, the New York congressman said he could see a mass exodus happening in his state if tax rates go up on residents, which he also explained includes parts of the stateâs business community.
âBig people in the business community who feel this is going to terribly impact them â¦ they are talking about moving their address to North Carolina, Florida, wherever â¦ and that then will have a compounding effect because thereâll be less state revenues available. That means local governments will have to raise property taxesâitâs really a vicious cycle,â King said.