House Majority Leader, Kevin McCarthy, the highest-ranking Californian Republican in the Congress, challenged his state’s governor – Jerry Brown – over Brown’s opposition to tax reform. McCarthy’s challenge came on the very same day that the a massive state gas tax hike hit California.
“If Gov. Brown is worried about the tax burden, let’s make cutting [taxes] a federal and state project,” McCarthy also said in a video his office had released on Wednesday. “We’re lowering rates at the federal level. So if Gov. Brown works to lower rates in California, I will stand right beside him to get that done.”
Brown also sent letters last week to the Republican members of the California Congressional delegation, calling them to oppose any types of proposals that would eliminate the state and local tax deductions, also known as ‘SALT’. California which is a populous, high-tax state, would be among those locales who are hit hardest by the SALT elimination in the proposed GOP tax reform.
However, McCarthy emphasized that the GOP’s proposal balances the SALT elimination by doubling the standard deductions, which he said, “means the first $24,000 per couple is tax free, actually lowering rates for most Californians.”
“This bill is a win for everyone, especially the people of California,” McCarthy in his video said. “So when I hear Gov. Brown worried about the tax rates going up after we reform the state and local tax deduction, I take his concern to heart.”
Republicans have further argued that the SALT deduction would not actually be necessary if California’s taxes were not among the highest in the nation.
The potential elimination of SALT and the gas tax increases enacted by the Democrat-dominated Californian legislature suggest that the taxes will be an issue in the 2018 congressional races, where the Democrats are targeting at least seven of the GOP seats. Democrats are unlikely to retake this majority in the House of Representatives from the Republicans without forging a path through the state of California.
Brown’s office never responded to McCarthy’s challenge. His office instead had referred the letter he had sent to the California Congressional Republicans last week.
In that letter, Brown had argued that “getting rid of an individual’s ability to deduct his or her California taxes is a horrible idea, but it is made far worse when you preserve—at the same time—the right of corporations to take those same deductions.”
“Can you tell me how much your neighbors and fellow citizens will have to pay because of this proposal? Budget analysts say that it will cost them many thousands of dollars,” he further argued.
