CAPITOL — The tax overhaul proposed by President Donald Trump would cost the average Capital Region taxpayer $3,088 in lost federal tax deductions, state officials said Thursday.
The Republican-friendly proposal has been assailed by many Democrats, among them New York Gov. Andrew Cuomo. “I urge all New Yorkers to make their voices heard and tell Congress to stop this reckless plan,” he said in a news release.
Cuomo’s calculations of the impact stem from the proposed elimination of deductions for state and local taxes paid. Currently, taxpayers who itemize their deductions can subtract state income tax and local property tax payments from their federal tax liability.
In the Capital Region, Cuomo said, losing that deduction would cost 164,649 residents a total of $508.4 million in the first year, an average of $3,088 each.
Statewide, Cuomo said, the average first-year cost would be:
- $423 for the 649,718 taxpayers with an adjusted gross income less than $50,000;
- $1,299 for the 1.16 million taxpayers with an AGI of $50,000 to $100,000;
- $2,688 for the 686,506 taxpayers with an AGI of $100,000 to $150,000;
- $4,300 for the 319,016 taxpayers with an AGI of $150,000 to $200,000.
The scale climbs from there. The wealthiest 0.2 percent — the 6,206 taxpayers with an adjusted gross income greater than $5 million -- would lose $656,988 in deductions.
Cuomo said it would be illegal double taxation that would wring an extra $17.5 billion a year out of 3.3 million New York taxpayers. He also called it hypocritical.
“This plan puts corporations over people and billionaires over the middle class,” he said. “And rather than cutting taxes for hard-working Americans, it would tax them on the taxes they are already paying.”
Cuomo said the provision for a state/local tax deduction was included in the Revenue Act of 1862, which created the nation’s first income tax, and in the Sixteenth Amendment to the U.S. Constitution of 1913, which created the modern income tax.
The deduction, he added, is a fundamental statement of the long-standing historical right of state and local governments to raise revenues and taxpayers not to be double taxed.