Pass the SALT?

Explain It to Me

Vox Media Podcast Network

Education, Politics, News, Society & Culture

4.4 • 7.9K Ratings

🗓️ 10 November 2021

⏱️ 60 minutes

🔗️ Recording | iTunes | RSS

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Summary

Dylan, Jerusalem, and Dara discuss congressional Democrats’ efforts to uncap the state and local tax (SALT) deduction, and how the party found itself proposing a massive tax cut for high-income households. They also dive into the deduction’s stated purpose (encouraging states to spend on social programs) and talk about other programs that could encourage states to invest in health and education. Finally, they examine a white paper showing that domestic violence crimes didn’t increase during the Covid-19 pandemic in 2020. References: The state and local tax deduction, explained [Vox] SALT cap repeal would overwhelmingly benefit high income households [Tax Policy Center] Reconciliation may deliver a tax cut to the rich [Committee for a Responsible Federal Budget] 5-Year SALT cap repeal would be costliest part of Build Back Better [Committee for a Responsible Federal Budget] Senators Menendez and Sanders show the way forward on the SALT cap [Institute on Taxation and Economic Policy] Easy on the SALT: A qualified defense of the deduction for state and local taxes [Daniel J. Hemel, University of Chicago Law School] Congress can help state and local governments prepare for a rainy day without repealing the SALT cap [Tax Policy Center] What you don’t know about fiscal federalism can hurt you [Milken Institute Review] Progressive politics from the ground up [CommonWealth Magazine] California is making liberals squirm [The New York Times] Effects of COVID-19 shutdowns on domestic violence in US cities [Amalia R. Miller, Carmit Segal, and Melissa K. Spencer, National Bureau of Economic Research] One explanation for conflicting reports on domestic violence during the pandemic [Aaron Chalfin, Twitter] Hosts: Dylan Matthews (@dylanmatt), senior correspondent, Vox Jerusalem Demsas (@jerusalemdemsas), policy reporter, Vox Dara Lind (@dlind), immigration reporter, ProPublica Credits: Sofi LaLonde, producer & engineer Libby Nelson, editorial adviser Amber Hall, deputy editorial director of talk podcasts Sign up for The Weeds newsletter each Friday: vox.com/weedsletter Want to support The Weeds? Please consider making a donation to Vox: bit.ly/givepodcasts Learn more about your ad choices. Visit podcastchoices.com/adchoices

Transcript

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0:00.0	I think my microphone was in my beard.
0:04.8	That would do it.
0:05.8	Clean shave and privilege is real.
0:24.0	Hello and welcome to another episode of The Weeds.
0:26.7	I'm your host Dylan Matthews and I'm joined this week
0:29.3	by Vox Palsy reporter Jerusalem Demsys.
0:32.4	Hello there.
0:33.6	And pro-publiche's Darryl Lind.
0:36.0	Hello, Jerusalem. Welcome back from across the pond.
0:39.6	Yeah, great times. Glad to be back in America.
0:42.9	Now that we're back in America, we're going to be talking about tax provision that only
0:46.5	exists in America so far as I am aware. And I've tried to find other countries that do this,
0:50.8	none of them do. And it is the state in local tax deduction or salt.
0:56.5	So this is a provision of the federal income tax code that as we're recording this is causing
1:01.8	some of the fiercest fights between Democrats within Congress. And it raises a lot of interesting
1:06.8	questions about how to tax the rich, about the relationship between Red and Blue States,
1:12.1	and about just how bad exactly the state of New Jersey is.
1:19.0	I love New Jersey. I lived in Newark, but still come on. But before we get into New Jersey,
1:23.7	and it's many failures, some background. Until 2017, the federal income tax had an unlimited
1:30.5	deduction for state and local taxes. So people could deduct all their property taxes,
1:35.3	and either their income or their sales taxes from their federal tax bill.
1:40.0	Then to partially pay for the Trump tax cuts, Republicans put a $10,000 cap on this deduction.
	...

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