GOP Tax Bill Forces Democrat States to Face Their High-Tax Reality

(Daily Caller News Foundation) Republicans’ proposals to reform the U.S. tax code have revealed the exorbitant tax rates Democratic-controlled states have saddled on their citizens, and the Democrats’ response is making them look clueless.

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Nancy Pelosi/IMAGE: CSPAN2 via YouTube

House and Senate Republicans bills, respectively, slash the corporate tax rates, reduce the number of tax brackets and individual tax rates, lower tax rates on the majority of American small businesses, incentivize capital investment through short-term expensing, increase tax credits for having children (which Democratic senators voted against) and include a number of other arguably positive features.

Democrats in elected office and the media are doing everything within their power to sow disdain for the Republican reform effort in the hearts of American voters, arguing that GOP lawmakers are giving concessions to the wealthy at the expense of middle-class taxpayers and are working to increase the federal deficit–a complete diversion from conservative orthodoxy.

The New York Times editorial board openly lobbied its readers and the public days before the Senate voted to contact their senators and rail against Senate Republicans’ bill.

The Times opinion page specifically called out the Senate’s bill “$1.4 trillion” increase to the federal deficit — the amount the Congressional Budget Office (CBO) predicts the deficit to rise in ten years.

The newfound concern among Democrats for the fiscal state of the nation is interesting, given that Sen. Bernie Sanders of Vermont, one of the party’s leading candidates for the White House in 2016, proposed a budget that would have added $21 trillion to the nation’s debt over the next decade.

Former Secretary of State Hillary Clinton’s proposed plans for tax reform and the federal budget were expected to shrink long-run GDP roughly 1 percent and marginally increase the federal deficit.

The lamentations of Democrats is also not all that surprising when one examines the states deemed to be “winners” and “losers” from the GOP bills.

Democratic-controlled states are the ones most likely to get hit the hardest from the bill, but not because of the changes to the tax code but because of high tax rates and regulations the states’ legislators have imposed over the course of decades.

California and New York are the shining examples Democrats are using to point out the ills that would befall states if Congress approves the respective bills in conference, which is expected to occur as early as this week.


The New York Times wrote a piece in late November detailing the various tax credits, tax-exempt bonds and deductions Californian citizens and small businesses would lose if Congress passed the Senate’s tax reform bill as it stands.

These credits and deductions are indeed vital for many families and small businesses.

Without the assistance, many individuals and business owners could not afford to stay in California.

The state’s two most prominent Democratic political figures — House Minority leader Nancy Pelosi and Sen. Kamala Harris — came out swinging against the tax bill.

Pelosi likened the tax bill to “Armageddon,” while Harris called her colleagues bill “a victory for corporations and the top 1 percent of Americans, not teachers, not seniors, and certainly not the middle class.”

California Gov. Jerry Brown called the bill “evil in the extreme.”

What the Times, Pelosi, Harris and Brown fail to address in their criticisms are the underlying reasons that Californians need the government’s financial assistance to live and run a business within the state.

The state and local community legislators have instilled stringent, often prohibitory, zoning and environmental regulations that have retarded the building of low-income housing, caused hundreds of thousands to flee the state and housing prices to skyrocket.

California-state lawmakers ultimately have control over a number of their state taxes, like personal income, sales, property and other state-specific taxes.

Taxpayers pay the majority of their tax burdens not to the federal government, but to their own state and local governments.

In California, roughly 11 percent of the income generated in the state goes towards paying taxes, adding up to roughly $5,230 per capita.

California lost 109,000 more people than it gained in 2016, while comparatively low-tax and cost of living states, like Texas and Florida, saw a 126,000 and 207,000 net uptick in population.

The Times wrote another story only days after the Senate’s tax bill passed that launched into a surprising defense against raising taxes on wealthy New Yorkers.

The primary complaint the Times raised was that Republicans are stripping local and state income tax deductions, which would cause rich New Yorkers to pay the full brunt of local taxes on the residents of New York City.

Many of those wealthy earners have lavish jobs on Wall Street or within the borders of Manhattan and were the targets of Democratic candidates only one year ago on the presidential campaign trail.

New York, like California, is a state run by Democrats and one that taxes its citizens at a higher rate than any other state in the nation.

The state’s combined state and local income tax burden tops California’s at 12.7 percent.

That amounts to roughly $6,993.42 per New York taxpayer.

Senate Minority leader Chuck Schumer of New York called his colleagues’ bill the “heights of hypocrisy,” while the mayor of his hometown of New York City is trying to levy a 14 percent tax increase to pay for improvements to the city’s subway system.

New York City Mayor Bill de Blasio also faces between a $65 and $142 billion shortfall on the its pension obligations, which the city does not expect to pay off for at least another 15 years.

If the goal of Democrats is to ensure their constituents are getting a fair shake from the Republicans tax reform push, it would seem that state and local tax and regulatory reform could help them achieve those ends.

Republished with permission from Daily Caller News Foundation via iCopyright license.

  • Kurt Emerson

    I have to thank you. It’s about time someone pointed out the obvious. It’s fair to all pay the same income tax based on income without deducting for state and local taxes.
    For the first time in decades residents of high tax states will feel the pain of allowing state governments to spend excessively. They will be aware when paying equally for services provided by the federal government. Far better for the future. It will force states to reign in excessive spending.

    • Lmcyber

      They are spending excessively. That’s total BS. California has a population of 39 Million, while a state like Wyoming has what, a few hundred thousand. There is a huge amount of immigration that comes into the coastal states, legal and otherwise. So, this issue that they are spending excessively is ridiculous. California is one of the few states running with a surplus. They have an incredible higher education infrastructure. No one wants to go to some no name college in places like Wyoming, Kansas, Oklahoma, etc. They want to go to the better schools, which some of the best schools in the country are located in these states, especially California, to include state schools. Because they have a huge population, it is imperative that they keep up with the mass transportation, the transportation infrastructure such as roads and highways. That is only part of what state governments are supposed to do for their citizenry. The rest of the country benefits from what states like Ca. do, who puts more in the coffers than it ever takes out. Not only that California is the technological capital of the country. They have the economic engine which runs this country financially. This SALT deduction problem will be history soon, just as soon as Dems take over Congress and then impeach Donnie!

      To actually believe the stupid argument that Republicans are putting out to support their horrible tax plan, which is just a pay off to their donors, shows a lot of naiveness and gullibility.

      This tax plan has so many pitfalls for the US economy that Repubes are taking a huge chance by passing this bill. This bill will only make less that 30% of the population happy. There is close to 70% of the population who educated themselves on what this bill will do to them and the economy, and guess what, they hate this bill, first time in history for the US to hate a tax bill.

      • Kurt Emerson

        I don’t disagree with the population and needs assessment. With that said, yes I know for a fact that they are spending excessively. They spent almost 100k on me for something that could have and definitely should have cost $7500. They weren’t feeling it for most of the summer so they flew me out every week and home every weekend for the summer. There is a marked difference between public and private sector efficiency. I have worked in most states in the country. California is one of the most wasteful I have been to. Beautiful place and great people with a carefree way of life. It’s just compounded when mixing that with the public sector. Oil and Gas companies are by far the most efficient at pretty much everything. They hire top tier management and HR and get things done right and in a marked hurry. This is not hearsay. I experienced this for years in many districts, cities, and counties. It’s an absolute fact. The private sector almost never has people loitering around on their dime ($450hr in this case). The public sector could care less as its not their money. They don’t need to show a profit or be efficient. When they need something they raise taxes. This phenomenon exists in Fed Gov and every State in the country. Some are better than others. Midwestern States Wyoming especially are some of the most efficient.
        You can research it if you like but it can’t be disputed. I’m sorry if that irritates you.
        Local taxes should never have been deductible in the first place.
        I.E. California could raise tax rate to 35% and then residents would pay far less in Federal taxes as those with equal income in a state with single digit income tax. There was no cap it’s is an unfair system. Now it is a fair system. I understand that people may not like it. A 10K deduction will cover all lower middle class income people. Only the wealthier will pay a little more in tax after crossing 100k or more.

  • therealworld

    If the Liberal states would lower their tax burden on private citizens they would receive the same benefits the rest of us will. They won’t and they will continue their lies. Liberals are Ignorant

  • therealworld

    You people in CA and NY, Stay there and please stop moving to Texas, We Don’t Want Liberals Here, you screwed up your state, stay out of our’s.

  • desiminator

    You people in CA and NY, Stay there and please stop moving to Texas, We Don’t Want Liberals Here, you screwed up your state, stay out of our’s.

  • Steve G.

    I’m soo sick of liberals crying about the deficit. The deficit went up by almost 10 trillion dollars under Obama and know they care about it? Anything that leads to more freedoms and opportunities for Americans, the Democrats will vote against it.

  • jcrawdad

    GOP Tax Bill Forces Democrat States to Face Their High-Tax Reality

  • jcrawdad

    GOP Tax Bill Forces Democrat States to Face Their High-Tax Reality


  • Lmcyber

    The problem is this administration doesn’t want to hear how well these states run on Democratic policies. These states are actually providing good government services as they should, and with a population of $34M in California alone, their taxes do need to be invested in education, where 90% of all K-12 students in the country, attend public schools. These states see what red policies have done to their states. They have emaciated their education, their infrastructure, health care, public services, etc. The taxes aren’t going to change with these states. What will change is this administration and Congress, as very few people in this country believe in these policies.

    This tax bill is only good for 5 years for all individuals. What a waste of time and paper! Democrats typically have to, and this is shown in history, come in and clean up the mess the RED children have made of the country. It happened after Reagan, and it happened after the Bushes. I don’t think the American people are going to forget this mess this time. They have been through too much over the years and the incompetency of Trump has caused a dramatic drop off from Republicans to Democrats in just a short time. This trend will continue as Repubes have shown an inability to govern.

    Right now millennials prefer Democrats running Congress by 48 points. And the country, by a large margin do not like anything about this admin., nor Congress, and the lack of its governing ability. This tax bill just dumped a huge burden on millennials and this group of repubes don’t care. They admit this is just a payoff to donors and to heck with the middle class among others in this country!

    As for those of you who live in places like Texas, there will be some who will move from more liberal states. Usually the losers, who can’t make it in a competitive work environment. The more talented and those who are willing to work hard stay in these states and do quite well. And the ones who move, will still be liberal. All that is going to happen with Red States, is they will become more Democratic with the movement from states like Ca, and NY. They are just diluting the Red states voting base.

    Because this tax bill was not thought out or had gone through regular order, will have all kinds of unintended consequences, and that will be one of them. This bill will end up being a big mess when all is said and done. This bill was supposed to be tax reform, which means broadening the base, bringing down corporate a bit, and getting rid of their loopholes. All this bill does is transfer massive wealth from the middle and lower classes to the billionaire class, which is the swamp. This bill just put the US in LAST PLACE WHEN IT COMES TO INCOME INEQUALITY.

    Way to go Repubes! You screwed it up again!!