The House voted Monday night to send the tax reform bill to conference committee. The Senate is expected to follow suit.
It’s the elimination, or capping, of the state and local tax deduction that has most upset people in high-tax states like New Jersey.
Now, two New Jersey congressmen have teamed up to try to prevent that. They are appealing to members of the conference committee to restore the deduction.
“We hope that the conference committee will consider our proposal, bipartisan in nature, that would retain in its entirety the deductability for state and local taxes known as SALT. This is extremely important to New Jersey and there has been that ability to deduct state and local taxes since the modern code was enacted a century ago in 1913,” said Lance.
“Neither the House bill nor the Senate bill goes far enough in this area, in my judgement, and that’s why were are presenting our proposal to the conference committee. I think it’s very important that this be considered by the conference committee and that I don’t favor the present version, either of the House bill, or the Senate bill and I hope that the conferees will choose to examine a proposal that we have put forth in a bipartisan capacity. New Jersey is a sending state. We send more revenue to Washington than we receive back and I don’t want to make that situation worse. Additionally, this is a matter of federalism and we don’t want to be in a position of taxing already what has been taxed. Taxes on taxes and that is why Josh Gottheimer and I are working in a bipartisan capacity in this area,” said Lance.
Lance is working with Democrat Josh Gottheimer on this. Their amendments would also restore deductions for medical expenses, mortgage interest, student loan interest and would protect graduate student tuition. Gottheimer says he thinks the tide is turning on this issue.
“Well, here’s what I’m hearing and I spoke to a lot of people in the California delegation, New York delegation, Connecticut delegation, people who actually voted for this the first time. What they’re hearing back home is people are in a panic because if this thing passes the way it is, property values will go down between 15 and 20 percent. So, members of Congress have been going home and hearing that people are rightly panicked that their property value is going to be underwater. Their nest eggs are going to go away. They’re hearing that people on fixed incomes are going to say, wait a second how am I going to afford increased taxes, I can’t afford that. A competent teacher in Paramus, New Jersey, when you do the math, their taxes will go up $5,000 under this plan. People are panicking and calling in. We got a tax hotline set up in the office, the phones are going off hook. The emails are coming in. And, I think other members of Congress are starting to hear increasingly what we’re hearing, which is you can’t do this to us and how are we going to pay for this. So, I’m hopeful that other members actually take these into account in these discussions in the coming days,” said Gottheimer.
Gottheimer and Lance are both members of the Congressional Problem Solvers Caucus. They hope they can solve this problem. Lance told us he expects the conference committee to work on the bill next week and get it to the president before Christmas.