When the Trump administration announced their tax reform plan a few weeks ago, one of the most controversial changes proposed was the elimination of the state and local tax (SALT) deduction. This deduction, which allows those who itemize on their federal returns to deduct state and local real estate and personal property taxes as well as either income taxes or general sales taxes, is particularly handy for filers in states with heavier tax burdens, like California.
So, with the SALT deduction on the chopping block, many filers are worried that they will soon be hit twice by the taxman.
With this new development in mind, Dan Walters takes a deep dive into California’s expansive tax system. Despite the “tax revolt” begun in 1978 with the passage of Proposition 13, Walters notes that more recent years have brought a less balanced system of taxation – with policies now driven more strongly by those on the left.
Walters emphasizes that this trend is unlikely to change, though he does not mention what he foresees if Trump’s plan passes with the SALT removal included, and mentions that a revision of Prop. 13 may be the next big tax battle.
For the details of Walters’ tax exploration, read more here: California’s on a tax binge, despite one of the nation’s highest burdens