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View Diary: It's Not A Tax On Blue States (77 comments)

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  •  This is very consistent Republican tax policy. (none)
    Whereas previous tax cuts mainly favored the very wealthy, they did throw in some middle and lower income tax breaks to make them more politically palatable.  This time, however, they are almost exclusively favoring the wealthy.  Don't forget that they are also attempting to eliminate federal taxes on dividends and long-term capital gains (already down to 15%).  In effect, they are saying that revenue derived from capital, as opposed to employment, is not really "income".

    Wealthy people, even the working wealthy (company owners, CEO's, executives, etc.) make most of their money off of capital (long-term gains, dividends, stock options, & other non-income incentives). Therefore, their income tax burden (whether federal or state), since they will eventually have little if any "income", is heading toward zero. Thus, eliminating the federal deduction for state income taxes has little negative impact on the wealthy.

    Now, for the rest of us working stiffs (or in my case, retired and living off a fully taxable pension), eliminating the federal tax deduction for state income tax paid is truely a significant tax increase, and as someone mentioned above, an excellent example of double taxation.

    •  Sorry (none)
      Meant to say that this tax policy favors the wealthy in comparison to the middle class - obviously there are no tax cuts involved.  But, these tax increases are overwhelmingly directed at the middle class.

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