New York officials on Tuesday moved to sue the federal government over the 2017 tax law that caps state and local tax deductions at $10,000.
Gov. Andrew Cuomo announced the lawsuit, long in the planning stages since he first threatened it when the measure was being approved seven months ago, pointing to protections for states in the U.S. Constitution.
“This is their political attempt to hurt Democratic states,” Cuomo said. “It is totally repugnant and hypocritical of the conservative ideology that they preached which is limited federal government and protect states’ rights.”
Cuomo repeatedly called the tax law, as well as additional Trump administration’s actions on responding to Puerto Rico’s storm damage, immigration policies and the president’s appearance at a press conference with Russian President Vladimir Putin as “repugnant” and “un-American.”
The suit was simultaneously announced by Attorney General Barbara Underwood, who called the cap on tax deductions an attempt to bully New York.
“This cap is unconstitutional – going well beyond settled limits on federal power to impose an income tax, while deliberately targeting New York and similar states in an attempt to coerce us into changing our fiscal policies and the vital programs they support,” she said.
The limit on state and local tax deductions impacts high-tax states like New York, California and New Jersey, and property taxpayers in especially high-tax areas, like the New York City area.
State lawmakers earlier this year approved legislation meant to soften the cap on the deductions through contributions to non-profit entities, though those provisions are being reviewed by the IRS.