RELEASE: Gottheimer, Garbarino, Menendez Unveil New Bipartisan Legislation to Fully Restore the SALT Deduction

Above: Gottheimer, Rep. Menendez, Bergen County Commissioner Zur, and Bergen County Clerk Hogan at a road salt storage facility in Paramus to introduce the SALT Deductibility Act.

PARAMUS, NJ — Today, April 13, 2023, U.S. Congressman Josh Gottheimer (NJ-5) joined Congressman Rob Menendez (NJ-8) to announce the SALT Deductibility Act, a bipartisan bill to completely restore the State and Local Tax (SALT) deduction. The bipartisan legislation will allow taxpayers to fully deduct their state and local taxes on their federal income returns, stop double taxation, and cut taxes for millions of middle-class Jersey residents and families across the country.

In 2017, Red Moocher States gutted the SALT deduction, capping it at $10,000, and resulting in a tax hike for many middle-class families.

Gottheimer and Congressman Andrew Garbarino (NY-2) are the bipartisan leads of the SALT Deductibility Act. Co-leads include Representatives Rob Menendez (NJ-8), Chris Smith (NJ-4), Mike Lawler (NY-17), Anna Eshoo (CA-16), Young Kim (CA-40), and Brad Schneider (IL-10). The bipartisan bill has 48 cosponsors, including eight Republicans.

New Jersey cosponsors include Representatives Gottheimer (NJ-5), Rob Menendez (NJ-8), Chris Smith (NJ-4), Tom Kean (NJ-7), Frank Pallone (NJ-6), Bonnie Watson Coleman (NJ-12), Mikie Sherrill (NJ-11), Andy Kim (NY-3), Donald Payne (NJ-10), and Don Norcross (NJ-1).

Before 2017 and since 1913, taxpayers were able to deduct what they paid in their local property or state taxes before paying their federal taxes — to avoid getting taxed twice on the same income. Middle-class families in Sussex, Bergen, and Passaic Counties paid anywhere from $2,500 to $14,000 more in taxes after SALT was gutted.

According to public reporting, restoring the SALT deduction would lower taxes for nearly a third of New Jersey residents — almost three million people — and eighty percent of them have incomes of $216,000 or less.

Gottheimer has helped pass four bills out of the House to restore the SALT deduction, and the Senate did not act.

“Restoring the SALT deduction will get more dollars back into the pockets of hard-working, middle-class Jersey families who are already struggling with higher costs,” said Congressman Josh Gottheimer (NJ-5), Co-Chair of the bipartisan SALT Caucus. “The bill is supported by enough Republicans from Blue States that we would have the votes to block Red State attempts to gut SALT further and prevent it from coming back once the Tax Hike Bill expires in two and a half years.”

“The SALT deduction cap has devastated my community by placing an unfair financial burden on Long Islanders and on taxpayers across the country,” said Congressman Andrew Garbarino (NY-2), Co-Chair of the bipartisan SALT Caucus. “Long Islanders pay some of the highest property taxes in the country and, for the hardworking middle-class families in my district, the $10,000 cap means they are only able to deduct a fraction of what they pay from their federal income taxes. I am talking about police officers, firefighters, nurses, teachers, and small businesses owners who are being double taxed on money that was never available to them. This injustice has gone on long enough and, with this bipartisan legislation, we can finally right that wrong and provide much needed tax relief to millions of Americans.”

“Since 2017, New Jersey families have been unfairly penalized by the cap on the SALT deduction,” said Congressman Rob Menendez (NJ-8). “This legislation will provide much-needed relief for working families in our district and across New Jersey. This is a significant step towards tax fairness for our constituents, and I look forward to working with my colleagues to get it done.”

Cosponsors of the bill include Representatives Gottheimer (NJ-5), Garbarino (NY-2) Menendez (NJ-8), Smith (NJ-4), Lawler (NY-17), Eshoo (CA-16), Kim (CA-40), Schneider (IL-10), D’Esposito (NY-4), Molinaro (NY-19), Ryan (NY-18), Kean (NJ-7), Swalwell (CA-14), Meng (NY-6), Morelle (NY-25), Pallone (NJ-6), Casten (IL-6), Phillips (MN-3), Tonko (NY-20), Lofgren (CA-18), McCollum (MN-4), Carbajal (CA-24), Watson Coleman (NJ-12), Auchincloss (MA-4), Krishnamoorthi (IL-8), Foster (IL-11), Bonamici (OR-01), Sanchez (CA-38), Sherrill (NJ-11), Kim (NJ-3), LaLota (NY-1), Levin (CA-49), Payne (NJ-10), Norcross (NJ-1), Quigley (IL-5), Davis (IL-7), Gomez (CA-34), Chu (CA-28), Holmes Norton (DC), Panetta (CA-19), Brownley (CA-26), Nadler (NY-12), Craig (MN-2), Raskin (MD-8), Huffman (CA-2), Sherman (CA-32), Connolly (VA-11), and Courtney (CT-2). 

Gottheimer was joined today at the Bergen County Salt Shed in Paramus by Congressman Robert Menendez (NJ-8), Bergen County Commissioner Tracy Zur, and Bergen County Clerk John Hogan.

Watch today’s announcement here.

Below: Gottheimer, Rep. Menendez, Bergen County Commissioner Zur, and Bergen County Clerk Hogan at a road salt storage facility in Paramus to introduce the SALT Deductibility Act.

Gottheimer’s remarks as prepared for delivery:

It’s great to be back in Paramus. I’m excited to welcome my good friend and my newly elected colleague from Hudson and Essex Counties — the Eighth District’s Congressman, Rob Menendez.

Now, you may be wondering why we’re standing here with this mound of SALT behind us. Anyone who lives in Jersey knows that when a winter storm is coming, you’ve got to salt the roads. That’s the best way to stop you from slipping and sliding in a storm. 

Well, for the last six years, since the Red States jammed through the 2017 Tax Hike Bill, Jersey families have been dealing with a tax storm. And there’s only one way to fix it – we need to get our State and Local Tax Deduction – or SALT – back, to help lower taxes, and make life more affordable for hard-working middle-class families. We need that SALT. 

Today, along with Rob and a bipartisan group of more than 48 Members of Congress from across the country — led on the Republican side by Andrew Garbarino from New York and with many from New Jersey and the tri-state area — we’re introducing new bipartisan legislation that will fully restore the SALT deduction, stop double taxation, and lower those taxes for millions of middle class Jersey residents and families across the country – for teachers, for nurses, for police and firefighters, for the hard-working men and women of labor. 

That’s why — with Rob and lead New York Republican Congressman Andrew Garbarino — we’re introducing the bipartisan SALT Deductibility Act to allow families to fully deduct their state and local taxes on their federal income returns, end double taxation, and give families in Jersey a tax cut. It will completely repeal the 2017 Tax Hike Bill’s $10,000 cap on our SALT deduction.  

Here’s the good news: we have 48 cosponsors, including eight Republicans, and expect this number to grow — which will put direct pressure on House Speaker McCarthy to listen to the millions of struggling middle-class families and take action to restore SALT.  

And, the bill is supported by enough Republicans from Blue States that we would have the votes to block Red State attempts to gut SALT further and prevent it from coming back once the Tax Hike Bill expires in two and a half years. 

Rob, Congressman Garbarino, and I have been working on this bill for months now. It’s been key to our work as Co-Chairs of the 33-member strong bipartisan SALT Caucus in Congress. 

If you’re just tuning into this issue: the 2017 Tax Hike Bill gutted SALT and put a $10,000 cap on the deduction nationwide. It was the red states versus the blue states. The T-Birds versus the Scorpions. They wanted us to pay their bills.

Before 2017 — in fact, since 1913 — taxpayers were able to deduct what they paid in their local property or state taxes before paying their federal taxes — to avoid getting taxed twice on the same income. 

When I voted “No” on that 2017 Tax Hike Bill, we all predicted that it would raise Jersey’s taxes and drive residents out of our state. 

It’s done just that. 

After SALT was gutted, middle class families in Sussex, Bergen, and Passaic Counties paid anywhere from $2,500 to $14,000 more in taxes. 

It was a direct hit on the Blue States — our taxes went up, and our middle class and programs for harder-pressed, lower income families suffered.  

Let me clear to all the naysayers: here in Jersey, the State and Local Tax Deduction is a middle-class issue. It’s not just something for the well to do. Restoring it will get more dollars back into the pockets of hard-working families who are already struggling with higher costs. 

In Northern New Jersey, our property taxes are highest in the country. The median property tax here in Bergen County is more than $15,000. When you add state income taxes, the average SALT deduction in 2017 was more than $24,000 dollars. 

When you do the math, with a $10,000 cap from the 2017 Tax Bill, you can see how middle-class taxes went up. That was a sucker punch if I’ve seen one. I mean, this isn’t Oklahoma, where the median property tax is around $1,600 — or Alabama, where the median property tax is just $740. 

According to public reporting, when we restore the SALT deduction, nearly a third of New Jersey residents — almost three million people — will get tax relief. Eighty percent of them have incomes of $216,000 or less. This is hardly a one-percenter issue. In New Jersey, this is a middle-class issue.

And we’ve got to deal with this. One study ranked New Jersey as the top state in the nation for outbound migration last year, a spot New Jersey has held for the prior five years.

Then, over the last year, according to the Census, we lost more of our residents to other states than any other state in the country except for California, New York, and Illinois.  People are heading to Florida, North Carolina, and Texas, where state income taxes are far lower or zero. And we need them. That’s our tax base. Those are our jobs. They are the key to the revenue we need to pay for our top-notch police, firefighters, and teachers.

To help make life more affordable for Jersey families and to put an end to the mass exodus, I’ve been fighting tooth and nail in Congress to restore SALT. 

I helped pass four bills out of the House to restore SALT and help cut property and state taxes. Yes, four. But all four times, the Senate Red Staters blocked the tax-cutting legislation.

But, the playing field has changed in this new Congress with the number of Republicans in Blue States who support restoring SALT. We all know how important that is with a Republican-majority House. 

Republican Members including Representatives Andrew Garbarino — who is leading the bill — Tom Kean, Chris Smith, Mike Lawler, Nick LaLota, Anthony D’Esposito, Marcus Molinaro, and Young Kim all support our bill to fully restore the SALT deduction. 

In two and a half years, the provisions in the 2017 Tax Hike Bill expire and we get our SALT deduction back fully. But, the millions of middle-class families we represent can’t wait that long. SALT must be restored in any tax package considered by the House this year.

Here in the greatest country in the world — working with members from coast to coast and across the political spectrum to restore the SALT deduction — I know our best days will always be ahead of us. We can lower taxes, stop double taxation, battle back the Red Moocher States, and bring more affordability to hard working Jersey families. 

May God bless you and your families, and may God continue to bless the United States of America.

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