Cities Urge Sec. Mnuchin to Keep SALT Out of Tax Reform Proposal

Vital deduction supports middle class homeowners and public services that benefit all citizens such as K-12 schools, law enforcement and public safety, transportation and infrastructure

WASHINGTON – September 24, 2017 – On CNN’s State of the Union program this morning, Treasury Secretary Steven Mnuchin indicated that the State and Local Tax (SALT) deduction will be eliminated in the tax reform proposal expected to be released this week. In response, National League of Cities (NLC) CEO and Executive Director Clarence E. Anthony released the following statement:

“Secretary Mnuchin’s comments today revealed a worst-case scenario for America’s cities and towns — that the administration plans to eliminate the SALT deduction in their forthcoming tax proposal. This is a reckless move that would result in the double taxation of millions of taxpayers who claim the deduction, 87 percent of whom have an adjusted gross income of under $200,000.

“The impact of eliminating the SALT deduction would be deeply felt by cities and states across the nation, limiting their abilities to make critical investments in public safety, education and infrastructure. It would also hurt homeowners who deduct their property taxes and mortgage interest, resulting in a 10 percent decline in home values in the immediate term. Sec. Mnuchin needs to understand that no one wins if SALT is eliminated — which is why it must be kept out of any tax reform proposal.”

Last week, NLC joined with state and local government organizations, service providers and other stakeholders to form the Americans Against Double Taxation coalition. The coalition is dedicated to preserving SALT, a federal tax deduction claimed by 44 million American taxpayers and supports local investments in infrastructure, public safety, home ownership and education.