CNCounty News

State and Local Groups Begin Defense of SALT Deduction

A Government Finance Officers Association (GFOA) report, The Impact of Eliminating the State and Local Tax Deduction, calculates the impact on individual taxpayers in each congressional district and illustrates a strong linkage between the deduction and homeownership. The report, released July 11 at a Capitol Hill briefing, concludes that if the state and local tax (SALT) deduction were repealed, individuals in every state and all income brackets would be adversely impacted. 

As part of its tax reform efforts, Congress is debating whether to eliminate the SALT deduction, which allows taxpayers to deduct state and local property, income and sales taxes to reduce their federal tax liability. The SALT deduction, as well as other such deductions for mortgage interest or charitable giving, are routinely targeted whenever discussions to reform the federal tax code take place. Eliminating deductions in a tax reform package would allow the federal government to collect new revenue, which would offset the loss in revenue resulting from the lowering of federal income tax rates, which is a key GOP objective in tax reform. 

Learn More

Read the report

The more notable findings from the report, which analyzed data from 2014, include: 

  • Almost 40 percent of taxpayers earning between $50,000 to $75,000 per year and more than 70 percent of taxpayers earning between $100,000 to $200,000 per year itemize deductions and use the SALT deduction
  • Over 50 percent of the total amount of the SALT deduction goes to taxpayers making less than $200,000 a year; and
  • The SALT deduction is not a red state v. blue state issue, taxpayer use of the deduction is widespread among all states regardless of geographic area, political identification, wealth, or economic activity. 
  • The SALT deduction was one of six deductions allowed under the original federal income tax code enacted in 1913. For well over a century it has served as a core pillar supporting the federal-state-local partnership that maintains the essential public services upon which Americans rely. 

State and local governments utilize the revenues from property, sales and income taxes to help finance infrastructure projects, law enforcement, emergency services, education and many other services. Eliminating this provision could limit state and local control of our tax systems, and constrain the policy options available to address local challenges and increased responsibilities due to the devolution of federal programs.

NACo, along with its Big 7 partners (National Governors Association, National Conference of State Legislatures, Council of State Governments, National League of Cities, International City/County Management Association and the U.S. Conference of Mayors) and the National Association of State Budget Officers, joined GFOA in releasing the report. 

Attachments

Related News

Texas National Guard troops use boats to search for survivors in Kerr County following floods that began in the region on July 4, 2025. More than 230 Guard personnel are working in three counties to clear debris and conduct search and rescue operations. Photo courtesy of the Texas National Guard
County News

Texas Hill Country floods kill more than 100 across six counties

Nineteen different local and state agencies are involved with the search and rescue efforts over six counties following flash flooding in Texas' Guadalupe River. 

The western facade of Philadelphia's City Hall looks onto Market Street.
County News

NACo kicks off 90th Annual Conference this week in Philadelphia

NACo is celebrating its 90th anniversary the way it knows best — gathering county officials from across the country to immerse themselves in the work they do at the Annual Conference in the city and county of Philadelphia. 

Village members in the Baltimore County neighborhood of Turner Station pause for a photo with Girl Scout Troop 353 by the recently established garden in Chestnut Park. Photo courtesy of Arkia Wade
County News

Maryland county invests in community ‘villages’

Baltimore County, Md. created a volunteer network or “village” to help with everything from groceries to doctor’s appointment to fighting isolation.