Blumenthal warns GOP tax reform could remove deduction for local, state taxes

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MERIDEN — U.S. Sen. Richard Blumenthal said Friday that he is hopeful the slim margin on Congressional budget votes is an indication that Republicans are divided in their efforts to reform the federal tax code. 

Speaking during a press conference at City Hall, he specifically raised concern about the deduction allowed under the federal income tax for local and state tax liabilities. 

“This measure really is a betrayal of the goal of tax reform — simplicity and fairness. We need a simpler tax code, we need a fairer tax code,” said Blumenthal, D-Connecticut.

Republican Congressional leaders hope to advance tax reforms as soon as this week, with Ways and Means Committee Chairman Rep. Kevin Brady, R-Texas, saying he intends to release a tax proposal Wednesday. 

He also said he wants a committee vote as soon as Nov. 6, as leaders in both chambers say they want to vote on a finance package before the Thanksgiving recess. They said that would allow for time to settle any differences, should the two chambers adopt differing plans, before the end of the year. 

The House Thursday approved a $4-trillion federal budget without making any changes to the plan that cleared the Senate the week prior. The budget passed with slim margins, though — 51-49 in the Senate, 216-212 in the House — with Republicans in both chambers voting against it. 

Blumenthal said he’s hopeful that means Democrats, who voted in lock-step against the budget, can find allies within Republican ranks once Congressional leaders unveil their plan for $1.5 trillion in tax cuts. 

Republicans remained optimistic that they will be able to pass a tax package with reforms and cuts, one of President Donald Trump’s top priorities. 

"Our plan can be summarized in three simple words: jobs, jobs, jobs," Trump said Tuesday. The push for tax cuts comes after a budget without spending cuts, despite Trump’s vow to cut the federal deficit, but Republicans said they will rein in spending. 

“I still feel strongly about addressing unsustainable mandatory spending,” said Rep. Diane Black, R-Tenn., who chairs the House Budget Committee. “I think we will tackle this important issue in the future. We don’t have a choice.”

Blumenthal Friday specifically focused on the possible elimination of deductions for local and state taxes, a move that was included in the so-called “Big Six” framework Republicans have used as the basis for their tax reform plans. 

Blumenthal said that would be “toxic for our citizens,” citing an evaluation from the Tax Foundation stating roughly one in four taxpayers in Middlesex county claims the deduction. Those filers save an average of $6,185, according to the report. 

Other elements of the proposal have been met with opposition recently, and an Associated Press-NORC poll earlier this week found that only 43 percent of respondents with at least some familiarity of the issue believe the tax cuts will benefit the middle class. 

The responses fell largely along party lines, with 79 percent of Republican respondents saying the reforms will help the middle class, compared with only 19 percent of Democrats. 

Trump, himself, has voiced his opposition to Republican plans limit the amount people can contribute to their 401(k) plans tax free. 

Blumenthal expressed concern that Republicans will try to rush a tax reform plan through Congress, leaving little time to review it. 

“We’re talking about a tax code that’s thousands of pages and they’re going to try to change it in a very short period of time, so I think the timetable may be problematic,” he said. 

Information from the Associated Press is included in this article.


Twitter: @reporter_savino


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