Governor Cuomo and Senator Schumer Slam GOP Tax Plan and Call on Members of Congress to Vote 'No' on Devastating Bill

Statement

Senator Schumer: Thank you very much and thank you Governor Cuomo for joining us. Governor Cuomo and I are on the phone together because this is so important to New York State. Now we're here to talk about the GOP-led tax plan, which takes aim at middle class benefits and puts a dagger to the heart of New York when it takes away state and local tax deductions. We've given you the numbers in the various districts. We'll send them to you again, but the purpose of this call is to call out the so-called compromise on critical deductions. Our Republican colleagues have felt the heat so they say, "Okay, we'll make a compromise." The problem is that this compromise still leaves for New York State. It takes away 71 percent of the deduction. So in other words, for every dollar they were going to take away before from New Yorkers, now they're taking 71 cents. It's as if they said, "Well in the past we'll chop off five of your fingers, now we'll only chop off three or four. Aren't we doing you a big favor?" That is not how the world works. New Yorkers are looking at getting the full deductions of property tax, of income tax and of sales tax. And to say, "We won't give you your full deduction" is taking away from New York.

The plan will increase taxes on New Yorkers by $16 billion. If you did an average, that would be $5300 a person. It impacts 3 million New Yorkers, one third of taxpayers. And the interesting thing here is that our New York Republicans and our New York Congressional Delegation hold the key as to whether this passes the House or not. I want to compliment Peter King, Lee Zeldin and Dan Donovan. They have come out pretty squarely or certainly behind this plan, against this plan rather, if it removes state and local deductibility. [Representatives] Reid and Collins are doing a disservice to New York by saying that they would still vote for the plan even though it hurts so many middle class New Yorkers. But the key votes right now are [Representatives] Tenney and Katko in Central New York and [Representatives] Stefanik and Faso in the Capital Region. If they were all at once to come out and say they would vote against this plan, the Republican leadership would have two choices. One, maintain the entire state and local deduction or two, let their plan fail. Because everyone's looking to New York here. The eyes of the nation are on New York because we are hurt the most. And if our own congressmen won't defend New York and instead bow down to the hard right wing paymasters who just want tax breaks for the wealthiest people and the wealthiest corporations. Take it from the middle class to get those tax breaks.

If the rest of the country sees New York is not standing up, they're much less likely to stand up. So this plan is just so much against New York, and you can say, "Well Chuck Schumer and Andrew Cuomo are Democrats and these guys are Republicans." But I did the same thing in 1986 when there was a Democratic plan led by Congressman Gephardt and Senator Bradley. They first proposed removing state and local deductibility. Democrats and Republicans stood firm in New York, stood firm, and they took it out. And the same thing could happen here for our Republican colleagues. And I would ask [Representatives] Reed and Collins to reconsider. Their districts are dramatically hurt by this. They're siding again with big special interests, the wealthiest people who do the best with this bill, rather than siding with middle class New Yorkers.

We need every single member of the New York House delegation to come out against the bill and compromise is still not good, as I said, 71 percent of the deductions are taken away under this so-called compromise. It's dramatically hurting New York, and just because we're not hurting you quite as badly as we did before, it's still dramatic hurt that every New Yorker who is affected, who pays a lot of property taxes, who pays a lot of income sales taxes, will be negatively affected. It also would decrease home values. The PricewaterhouseCoopers study estimated that eliminating SALT would result in a 10 percent decline in home values. And so with this compromise, there'd still be a decline in home values. And so even New Yorkers who are not affected would be hurt. Finally, this is double taxation. You're paying your state and local taxes and then they tax you on that even though you don't have the income because you're paying taxes. Let me give you a couple of examples here. Sam and Molly have three children. They make $75,000 a year. They're young parents and recent homeowners. They're still paying off student loan debt. And they had medical bills because one of their children became very ill this year. They currently itemize their taxes, taking advantage of the state and local deduction, mortgage interest, student loan and medical expense. This young couple would pay $720 more in taxes. Another example. Louis and John have three kids, they make $100,000 a year, paying off student loan debt from graduate school and they itemize their taxes but they had large medical expenses. They would pay $993 more in taxes.

President Trump and our Republican colleagues said that the middle class will not pay more in taxes, but under this proposal, with the elimination or the great curtailment of the SALT deduction, many, many middle class citizens of New York will pay a lot more in taxes. The people who benefit the most, the very wealthy. They get huge tax breaks while the middle class struggles. Again, we are urging our colleagues, particularly in the capital region, Congressmembers Stefanik and Faso, in central New York, Congressmembers Katko and Tenney, and in Western New York, Congressmembers Reed and Collins, to vote no on any bill that hurts New York with state and local deductibility. The economic future of our state depends on it.

With that, let me turn it over to Governor Cuomo.

Governor Cuomo: Thank you very much, Senator Schumer and first, I think all Americans owe Senator Schumer a debt of gratitude because opposing this tax bill is not just good for New York, it's supportive of the middle class all across the country. This is over a trillion-dollar corporate tax break paid for by the middle class and paid for by 12 states that lose state and local deductibility. I think it is hard to communicate right now to people because it's complicated. As soon as you say "eliminate the deductibility of state and local" people's eyes glaze over. I think the Congress is using the complication and rushing this through because they want to get it done before people realize what it actually does to them.

President Trump said this is a Christmas gift. If it's a Christmas gift, New York gets a lump of coal from Santa Trump on this one. So it's bad medicine for the entire country, but it is an arrow pointed at the heart of New York. The state and local deductibility, even with this compromise, to suggest that the state economy can handle this or frankly, survive it, is ludicrous. It just confounds the numbers. We're starting with a $4 billion deficit this year. Their quote unquote "compromise" where they say "Well, we'll put a cap on it and only the higher income will pay." That is exactly opposite the Republican dogma that I have heard for seven years as governor. They are the ones who say, "You're going to chase the rich from the state by raising taxes." If the rich leave, if the higher income leave, well then, that burden is going to fall down to the middle class and the working families. Congressman Reed and Congressman Collins know that full well because that has been their argument. High tax New York, you're chasing people from New York. So their answer is, now we're going to raise taxes even more on New Yorkers. That's what they are doing when they eliminate the deductibility. In raising taxes on New Yorkers, their theory, rich people will flee, that burden drops down to everyone else.

On top of it, we have a $4 billion deficit in this state and a person's taxes are not just from that district, it's carrying the state burden. So you're going to increase the state burden by having people leave, taking their tax dollars with them, and then we're left with the deficit. It doesn't pass the Blush Test. So these federal representatives have a choice. They can either vote as partisans, vote for their own political advantage, or they can vote for the interests of their constituents and they can vote like New Yorkers. That's the choice.

Congressperson Stefanik, it's not even close what will happen to the North Country. We've worked so hard to actually cap property taxes, first time ever, two percent property tax cap, was passed. We're controlling the cost of property taxes. This wipes all the progress of the past seven years right off the table. All the progress we made by keeping state spending down to two percent, all the progress we've made by cutting state income taxes, all the progress we made by capping property taxes, this wipes it out. So Congresspersons Stefanik, Tenney, Katko, Collins, Reed, Faso - they are voting for a tax increase for their district. It is that simple. That's why they want to rush it before their people figure it out and it is that simple.

Don't vote as a partisan, vote as a New Yorker. It is, as Senator Schumer said, a double taxation. It's taxing taxes from the party that says they want to cut taxes. They're fooling no one. I believe it is illegal as double taxation because that is exactly what it is. So this is not an issue that is going to go away. They can try to rush this vote and get it passed and I'll tell you what's going to happen the next day, you're going to see this nation rise up and call for a repeal of what they just did. So, rushing before people even get a chance to understand the bill isn't even going to serve their purpose because the next day we'll start a repeal movement. And as soon as people figure out what this actually does to them, especially in the state of New York - the largest donor state in the nation. $48 bill more sent to Washington than we get back. You're going to pay for a corporate tax break on the backs of New Yorkers? Well then you don't represent New York and we're going to make that clear. And again, Senator Schumer, thank you very much for leading this fight. Thank you for educating the public and thank you for fighting for the middle-class all across the country.

Senator Schumer: Well, thank you Governor, and as you point out, so much of the progress we've made in New York would be undone by this. And let me just add one final point here, and that is, if these folks think they can sort of hide from this? They won't. And everyone is going to see a year from now, election day, what they have done. Let's hope they don't have to face that and we'll vote the right way. We're ready for your questions folks.

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