Skip to content
CapRadio

CapRadio

listen live donate
listen live donate
listen live
donate
  • News
    • News

    • State Government
    • Environment
    • Health Care
    • Race and Equity
    • Business
    • Arts and Lifestyle
    • Food and Sustainability
    • PolitiFact California
    News
    • News

    • State Government
    • Environment
    • Health Care
    • Race and Equity
    • Business
    • Arts and Lifestyle
    • Food and Sustainability
    • PolitiFact California
  • Music
    • Music

    • Classical
    • Jazz
    • Eclectic

    • Daily Playlist
    Music
    • Music

    • Classical
    • Jazz
    • Eclectic

    • Daily Playlist
  • Podcasts & Shows
  • Schedules
  • Events
  • Support
    • Support
    • Ways to support
    • Evergreen Donation
    • One-Time Donation
    • Corporate Sponsorship
    • Vehicle Donation
    • Stock Giving
    • Legacy Giving
    • Endowment Support
    • Members
    • Member Benefits
    • Member FAQ
    • Member Newsletter

    • Fund drives
    • Drawing Winners
    • Thank You Gifts
    Support
    • Support
    • Ways to support
    • Evergreen Donation
    • One-Time Donation
    • Corporate Sponsorship
    • Vehicle Donation
    • Stock Giving
    • Legacy Giving
    • Endowment Support
    • Members
    • Member Benefits
    • Member FAQ
    • Member Newsletter

    • Fund drives
    • Drawing Winners
    • Thank You Gifts
  • About
  • Close Menu
 We Get Support From:
Become a Supporter 
 We Get Support From:
Become a Supporter 
  • State Government
  •  

GOP Tax Proposal Could Put High-Tax California At A Disadvantage

  •  Ben Bradford 
Wednesday, September 27, 2017 | Sacramento, CA
  

The tax overhaul proposed by Republican leaders in Washington could add more weight to California’s already-top-heavy tax structure.

The proposal calls for eliminating most itemized deductions, and while there are few details, lawmakers are operating as though that includes a deduction for state and local income taxes.

The Tax Policy Center estimates 80 percent of those claiming the deductions earn over $100,000 annually.

Opponents of the deduction call it a regressive tax incentive for the wealthy. But it’s also predominantly taken advantage of by taxpayers in blue states—where state and local income taxes are higher, particularly New York and California.

Loyola Law School tax professor Katharine Pratt says states with low or no income tax will see little effect.

“It disadvantages the state of California," Pratt says. "It increases the cost of the California income tax, and it puts pressure on the state Legislature to reduce the income tax rate."

Without the federal deduction, wealthy Californians—who already pay some of the nation’s highest state income taxes—will pay even more.

The conservative Tax Foundation estimates California receives a fifth of the roughly $100 billion in claims each year.

The Tax Policy Center has estimated that eliminating the write-off would raise the average claimants tax by $3,200.

In a statement, Democratic Senate Leader Kevin de León called the proposed removal a “direct hit to the pocket books of hardworking California taxpayers.”

He said it “will ultimately result in reduced funding available for infrastructure spending, and cause possible cuts to local services and vital state and local programs.”

It "could more accurately be seen as an incentive to high-tax states like California to lower its state tax burden to remain competitive with other states like Nevada, Florida and Texas,” Republican Senator Jeff Stone said in a statement.

UCLA tax law professor Eric Zolt agrees ending the deduction would pressure state governments to reduce their taxes, but he notes the effect would vary on individual taxpayers, since the overhaul calls for doubling the standard deduction—meaning less people would itemize to claim the state and local income tax deductions. And, the Alternative Minimum Tax—which currently negates state and local income tax deductions—would also be eliminated.

“The details matter and individual tax situations matter,” says Zolt. “The loss of the local and state tax deduction would be mitigated a lot by the repeal of the Alternative Minimum Tax. And for many taxpayers, doubling the standard deduction will mean that it’s not that important.”


Follow us for more stories like this

CapRadio provides a trusted source of news because of you.  As a nonprofit organization, donations from people like you sustain the journalism that allows us to discover stories that are important to our audience. If you believe in what we do and support our mission, please donate today.

Donate Today  

 taxes

Ben Bradford

Former State Government Reporter

As the State Government Reporter, Ben covered California politics, policy and the interaction between the two. He previously reported on local and state politics, business, energy, and environment for WFAE in Charlotte, North Carolina.  Read Full Bio 

 @JBenBradford Email Ben Bradford

Sign up for ReCap and never miss the top stories

Delivered to your inbox every Friday.

 

Check out a sample ReCap newsletter.

Thanks for subscribing!

Thank you for signing up for the ReCap newsletter! We'll send you an email each Friday with the top stories from CapRadio.

Browse all newsletters

More State Government Stories

Andrew Nixon / CapRadio

California will try to limit solitary confinement — again

February 7, 2023

Rich Pedroncelli / AP Photo

California lawmakers try again to cap insulin costs

February 8, 2023

Rich Pedroncelli / AP Photo

After legal trouble, advocates want state lawmakers to ‘reconsider’ Capitol Annex options

February 8, 2023

Most Viewed

California coronavirus updates: Las Vegas airport reports record passenger volume in 2022

Black educators in California say state budget reaffirms Black students don’t matter

10 new California laws that go into effect in 2023

In Turkey and Syria, outdated building methods all but assured disaster from a quake

How a new law is bringing more attention to natural carbon sequestration

We Get Support From:
Become a Supporter

Most Viewed

California coronavirus updates: Las Vegas airport reports record passenger volume in 2022

Black educators in California say state budget reaffirms Black students don’t matter

10 new California laws that go into effect in 2023

In Turkey and Syria, outdated building methods all but assured disaster from a quake

How a new law is bringing more attention to natural carbon sequestration

Back to Top

  • CapRadio

    7055 Folsom Boulevard
    Sacramento, CA 95826-2625

    •  
      (916) 278-8900
    •  
      (877) 480-5900
    •  Contact / Feedback
    •  Submit a News Tip
  • About

    • Mission / Vision / Core Values
    • Stations & Coverage Map
    • Careers & Internships
    • Staff Directory
    • Board of Directors
    • Press
  • Listening Options

    • Mobile Apps
    • Smart Speakers
    • Podcasts & Shows
    • On-Air Schedules
    • Daily Playlist
    • Signal Status
  • Connect

    •  Facebook
    •  Twitter
    •  Instagram
    •  YouTube
  • Donate

  • Listen Live

  • Newsletters

CapRadio stations are licensed to California State University, Sacramento. © 2023, Capital Public Radio. All Rights Reserved. Privacy Policy | Website Feedback FCC Public Files: KXJZ KKTO KUOP KQNC KXPR KXSR KXJS. For assistance accessing our public files, please call 916-278-8900 or email us.