Governor Andrew M. Cuomo today issued an open letter to the New York Congressional delegation calling on them to fight to overturn the federal tax bill that eliminated full deductibility of state and local taxes following reports of the bill's impact on home sales, including an 18 percent drop in home sales in Westchester in the second quarter of 2018.
The Governor's letter builds on his commitment to fighting back against this federal assault. New York was the first state to take action to protect residents from the federal administration's elimination of full state and local tax deductibility. In addition, Governor Cuomo and Attorney General Underwood filed a lawsuit to protect New York and its taxpayers from Washington's drastic rollback of the state and local tax deduction.
The full text of the letter is available below:
To the members of New York's Congressional delegation:
Recent reports have underscored the devastating impact the federal tax law is having on New York families, with home sales in Westchester plummeting by 18 percent in the last quarter. I write today to draw your attention to these reports and to call on you once again to take action to reverse this disastrous legislation.
On December 22, 2017, President Trump signed a bill passed by Congress enacting sweeping changes to the federal tax system that gutted the deductibility of state and local taxes. Some of you voted in favor of this law — a law that weaponized the federal tax system to attack New York and other progressive states. In fact, the twelve states most hurt by the limitations on state and local tax deductibility all voted against President Trump in the recent election. That's not a coincidence and that's not how democracy is supposed to work.
We knew when this bill passed that it was an act of political retribution against New York. New York is already the number one "donor" state in the nation, with our taxpayers contributing $48 billion more to the federal government every year than we get back. Absent changes to the State's tax code, the law's limitations on the deductibility of state and local taxes would cost New York's taxpayers an additional $14.3 billion this year. This law threatens jobs in our state and risks undermining the progressivity of the State's tax system, the investments and services that the State provides for its residents, and the competitiveness of New York's economy over the long term.
I fought this bill every step of the way while it was under consideration in Congress. Stunningly, four Republican members of New York's own Congressional delegation put party before their constituents and voted for these disastrous measures — and every Republican in the New York delegation failed to stop their leadership from passing the bill. In fact, one New York member has since taken the betrayal a step further by asking the IRS to effectively sabotage New York's efforts to protect our taxpayers, adding salt to the wound.
Now the impact of these New York Republicans' betrayal is clearer than ever. Reports indicate that home sales in Westchester plummeted by 18 percent in the second quarter of 2018 — the most since 2011 - with median sale prices dropping by double digits in some towns. Across much of the state, including Long Island and the Hudson Valley, Moody's Analytics expects home prices will fall by up to 10 percent or more. In short, Republicans in Congress have taken an action that devastates New York's families by undermining their most treasured and valuable asset — their homes.
In New York, we will continue to fight against this law. This session, we enacted bipartisan tax reforms to mitigate the negative impacts on New Yorkers of the limitations on state and local tax deductions. Last month, we joined together with three other states to sue the federal government over this illegal and targeted assault. And we stand ready to fight if the IRS takes hasty and politically motivated action to further the agenda of the Trump administration and the economic attack it has launched on New York.
But we cannot stop there. I am calling on you to do everything you can to fight in Congress to reverse this devastating legislation and restore fairness for the taxpayers of New York.
Governor Andrew M. Cuomo
Senate Minority Leader Charles E. Schumer
Senator Kirsten E. Gillibrand
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