Good day all. Part of the new tax laws passed by President Trump limited the deductions for state income taxes and property taxes. (I think mortgages were affected as well, but may be incorrect) The new tax law hit high tax liberal states hard. Well, to be more specific, it hit the rich liberals who live in those states hard.
This caused a number of rather wealthy people to decide it was time to bail out of the Blue States and head to states with lower tax rates. This caused the high tax Liberal Blue States to see their tax revenues take a nose dive. Rather then correct their problem, massive taxation, they decided to sue the Trump administration to overturn that part of the law. Well, the courts have ruled and the answer was “Go pound sand.” Here are the details from Fox Business:
A federal judge handed the Trump administration a win Monday, dismissing a lawsuit from states with high taxes.
The lawsuit asked U.S. District Judge J. Paul Oetken to block the Tax Cuts and Jobs Act’s limit on how much people can deduct in state and local taxes (SALT). The provision effectively raised the tax burden on citizens of high-tax states.
New York, New Jersey, Connecticut and Maryland brought the suit in July 2018, claiming the tax deduction limit was a way for the Trump administration to stick it to blue states. The judge ruled that the limit did not violate the 10th Amendment, which says that powers not delegated to the federal government in the Constitution are left to the states.
“The cap, again like every other feature of the federal Tax Code, is a part of the landscape of federal law within which states make their decisions as to how they will exercise their own sovereign tax powers,” Oetken wrote.
Basically, the judge is saying that the federal tax law doesn’t force the state governments to do anything. They can raise or lower their taxes at will. What it has done is cause the rich to vote with their feet and move out of the high tax states, taking what the Democrats consider “Their money” with them. This is why they wanted to get the courts to overturn the new tax law. Pity that their case was so much crap.
“Because the States have failed to plausibly allege that the cap, more so than any other major federal initiative, meaningfully constrains this decision-making process, this Court has no basis for concluding that the SALT cap is unconstitutionally coercive,” he continued.
Nope! No one at the federal level is telling the states how to handle taxes in their own states. What is actually happening is that the Progressive Liberal Democrats are seeing their primary targets leaving and now they have to go after lower income groups, commonly called the Middle Class and rape their bank accounts to pay for their socialist garbage.
The Tax Cuts and Jobs Act limited the state and local tax deduction at $10,000, which is below the average of what individuals claim in states like New York and Connecticut. Before the cap, the average deduction claimed in California, for example, was $22,000, according to Kevin de Leon, a Democratic member of the California state Senate. As a result, wealthier taxpayers have left these states for no-income tax destinations like Florida.
New York had the third-largest outflows of any state, with 452,580 people moving out within the past year. California, another high-tax state, had the largest outflow of domestic residents – with the highest proportion of people headed to Texas, Arizona and Washington. New York’s government estimated in February that tax payments were $2.3 billion below forecasts.
For decades, the Liberal states, (Known as blue states), have considered the taxpayers to be nothing more then money generation systems who’s funds are to be used to pay off Democrat power brokers. Most of these states have massive pension liabilities and no real way to pay for them. In years past, they would jack up taxes, claiming they were “Soaking the rich.” The “Rich” rarely paid the full levies of taxation thanks to deductions such as the ones now limited by the new tax laws.
Now that they have to actually pay these extortionate rates, the “Rich” are leaving in droves. New York is so desperate for money that they have been going after people who moved out of New York years ago. (I understand that Rush Limbaugh, who lives in Florida and has for a while now, gets audited by New York every year) Now that the courts have ruled against them, the outflow of money is only going to increase. This means raising taxes on the working people, (Middle class), until they drive them out as well. Eventually, the whole house of cards is going to collapse. Personally, I can’t wait.
Thatisall
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