WASHINGTON – One of President Trump's top economic advisers said Wednesday that he doubts Congress will ease the burden placed on high-tax states like New York by a 2017 change that limited the state and local tax deduction to $10,000.
Two months after Trump told reporters he was open to changes in the deduction limit, the chairman of the National Economic Council, Larry Kudlow, said there is little interest in that idea on Capitol Hill.
"I just don't expect to see tax reform opened up," Kudlow said at a breakfast with reporters, which was sponsored by the Christian Science Monitor.
Asked after the breakfast why Congress couldn't revisit an issue that's cost high-tax states hundreds of millions of dollars in tax revenues, Kudlow indicated that doing so would blow too big a hole in the federal budget.
"The bean counting is not good," Kudlow said. "It's a $700 billion plug. It's a lot of money, right? And we don't really have any money. So I think it's very hard to do that."
Kudlow also offered a spirited defense of the Republican tax overhaul that Congress passed in 2017, downplaying its impact on middle-income homeowners in states such as New York.
"They're not really paying very much, anyways, in income taxes," Kudlow said.
Kudlow's comments stood in sharp contrast to what both his boss – President Trump – and New York Gov. Andrew M. Cuomo have had to say about the state and local tax deduction in recent months.
Trump told regional reporters in February that he was "open to talking about" changes to the deduction
“There are some people from New York who have been speaking to me about doing something about that, about changing things," Trump said. "It’s been severe on them."
Cuomo, meanwhile, has blamed the deduction limit for a severe drop in state revenues, resulting from people changing their legal residence to avoid the double tax whammy of high state and federal taxes they would face if they stayed in New York.
Kudlow told reporters Wednesday that it was primarily the wealthy who were affected by the limit in the state and local tax deduction, which took effect in the current tax filing season.
But Cuomo said last month that the change was hurting middle-income taxpayers across New York State.
"Fifty-two counties have average taxes of above the SALT $10,000 cap," Cuomo said. "Fifty-two counties will see a tax increase."
Claude Solnik
Long Island Business News
2150 Smithtown Ave.
Ronkonkoma, NY 11779-7348
Stop scratching on holidays
Published: June 1, 2012
Off Track Betting in New York State has been racing into a crisis called shrinking revenue. Some people have spitballed a solution: Don’t close on holidays.
New York State Racing Law bars racing on Christmas, Easter and Palm Sunday, and the state has ruled OTBs can’t handle action on those days, even though they could easily broadcast races from out of state.
“You should be able to bet whenever you want,” said Jackson Leeds, a Nassau OTB employee who makes an occasional bet. He added some irrefutable logic: “How is the business going to make money if you’re not open to take people’s bets?”
Elias Tsekerides, president of the Federation of Hellenic Societies of Greater New York, said OTB is open on Greek Orthodox Easter and Palm Sunday.
“I don’t want discrimination,” Tsekerides said. “They close for the Catholics, but open for the Greek Orthodox? It’s either open for all or not open.”
OTB officials have said they lose millions by closing on Palm Sunday alone, with tracks such as Gulfstream, Santa Anita, Turf Paradise and Hawthorne running.
One option: OTBs could just stay open and face the consequences. New York City OTB did just that back in 2003. The handle was about $1.5 million – and OTB was fined $5,000.
Easy money.
Jerry Zremski – Jerry Zremski is The Buffalo News' Washington bureau chief. A News staffer since 1984, he won the David Lynch Memorial Reporting Award for regional coverage of Congress in 2017.
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