by J. Wesley Leckrone
One of the more controversial reforms in the Republican plan to overhaul taxes is the demise of the state and local tax deduction (SALT). According the Congressional Budget Office the SALT will account for .5% of GDP from 2014-2023 and cost $1.098 trillion. The Tax Policy Center ranks this as the 9th largest tax expenditure for the federal government in FY2018.
Some commentators argue that the elimination of the SALT is a way for the GOP to stick it to high-tax Democratic states. California and New York account for 32% of all the SALT deductions in 2013 and “blue” counties were at the top of the list of beneficiary according the the Tax Policy Center.
However, the SALT has also been criticized because it disproportionately benefits wealthier people who itemize their taxes. The Congressional Budget Office estimates that 80% of the SALT tax expenditure goes to the top quintile of earners and 30% to the top 1%.