Coalition to Congress: Changing SALT Isn’t Just “Double Taxation,” It’s a “Double Standard”

Tax Reform Framework Eliminates SALT for Individuals and Families, Retains Deduction for Corporations 

Washington, D.C. – Americans Against Double Taxation (AADT) today sent a letter to Congress calling the proposal by the “Big Six” to eliminate the state and local tax (SALT) deduction for individuals and families, while still allowing corporations to claim SALT, an “unfair, unjustified and unprecedented Double Standard.” AADT urged Congress to reject the “Double Tax, Double Standard” and oppose any legislation that fails to fully preserve SALT.

The letter, written on behalf of a broad coalition of state and local government organizations, service providers and other stakeholders – the same coalition which successfully fought to preserve the SALT during the 1986 tax reform debate – says that no taxpayer, “whether an individual, family or corporation, should be taxed twice on the same income.”  However, as the letter continues, “the mere filing of incorporation papers should not determine which taxpayers are protected from double taxation, and which ones are its victims.”

Bob Chlopak, Co-Director of AADT, said: “The double tax double standard proposed by the Big Six reveals their obvious hypocrisy: they believe the SALT deduction is good tax policy when it comes to corporate America, but they treat it as a waste of money when it benefits middle class America.  The middle class should not be treated like a second class when it comes to SALT; the deduction must be fully preserved.”

The letter describes how the individual deduction for state and local taxes has been part of the federal tax code since the beginning, one of only six deductions in the first federal income tax in 1913 where it has remained ever since.  It states that when President Lincoln imposed an emergency federal tax to finance the Civil War in 1862, state and local taxes were deductible as well. The letter goes on to explain that, prior to the present tax reform effort, “the President and the Congress have understood that it is wrong to tax Americans twice on their hard-earned incomes, making them pay federal taxes on monies they already paid to state and local governments in taxes.”

The letter concludes by saying, “Few choices are so stark and clear: you can stand with 44 million American households who depend on SALT, or you can create a Double Tax, Double Standard that, for the first time in the history of our country, imposes a double tax on individuals and families while fully protecting corporations.”

The full letter can be found here.

###

About Americans Against Double Taxation

Americans Against Double Taxation is a coalition of state and local government organizations, service providers and other stakeholders dedicated to protecting the state and local tax deduction (SALT), a federal tax deduction claimed by 44 million American taxpayers that supports vital investments in infrastructure, public safety, home ownership and education. SALT maintains carefully balanced fiscal federalism by allowing state and local governments to support state and local services. Any limitations, restrictions or changes to SALT would subject SALT to continued erosion and put vital public services at risk.  For more information, visit AmericansAgainstDoubleTaxation.org.