Some local governments say current GOP tax reform legislation co - FOX 8 WVUE New Orleans News, Weather, Sports, Social

Some local governments say current GOP tax reform legislation could cost them

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NEW ORLEANS, LA (WVUE) -

The final version of the GOP’s tax reform package remains in the works by a congressional conference committee after the House and Senate passed different versions.  Still some communities believe without major modifications they will face costly consequences.

"We're not only in the red zone, we're at the one yard line, we're going to get this done before Christmas and President Trump is ready to sign this bill,” said GOP House Majority Whip Steve Scalise, R-Metairie during a Tuesday press conference with other republicans in leadership positions in the House.

But some local governments are concerned.

The National Conference of State Legislatures said both the House and Senate versions of the proposed tax reform modify the State and Local Tax deduction also known as (SALT), by eliminating taxpayers’ ability to deduct their state and local income and sales taxes on their federal tax returns, and have also capped property tax deductions at $10,000.

"They also took away the state and local tax deductions and they took away all of the tax credits that major investors use to rebuild cities, now everybody in New Orleans knows this, everybody's reinvesting in downtown New Orleans, some of those measures that were used in the tax code to help incent that have been taken away,” said New Orleans Mayor Mitch Landrieu, who is also president of the bi-partisan U.S. Conference of Mayors.

Specifically, Landrieu spoke of the Historic Preservation Tax Credit which has benefitted the city of New Orleans.

"It eviscerates all the tools that cities have used like the Historic Tax Credit to rebuild massive infrastructure in the city of New Orleans like the World Trade Center or  the Saenger [Theatre], all of the tools that cities used to rebuild their downtowns that people live in…clearly those tools have been taken away from the cities, so we’re not happy that the majority in Congress didn’t take time to create a bi-partisan tax reform package,” Landrieu told FOX 8 News Tuesday.

Some tax experts agree local governments are watching the process nervously.

"There's a lot of state calculations that start with federal income and a lot of states recognize federal deductions, so as a consequence certain states with these generous federal deductions, such as appreciation it could cause state tax revenues to go down,” said Jerry Schreiber, a local certified public accountant who has being doing tax returns for 40 years.

Republican said the lower tax rates they have proposed will help the middle-class.  Both the House and Senate legislation raises the standard deduction for individuals to $12,000 and $24,000 for couples.

"Many who haven't seen their paychecks increase over the last 10 years are finally going to get real relief, they're going to see more money in their pockets from lower tax rates on average families they're going to see $1,200 more in their pockets,” Scalise said.

"It explodes the deficit for future generations so essentially what we did was this huge financial transfer to the wealthiest people in the country and to corporations on the backs of lower class, middle class families and cities,” Landrieu stated.

Still Mayor Landrieu said he has not lost hope that modifications can be made to the GOP tax reform legislation that will be more beneficial to local governments.

"Yes, we always hope. We're up there trying to be constructive not just destructive, you can't just say no, you have to get up there and work with them.  We have tried to do that, we basically have been shut out of the process, which is too bad and this is what Sen. McCain keeps talking about all the time, what they need to do in Washington is sit across the table, republicans and democrats and have something that works, that makes sense, that can be sustained over time,” said Landrieu.

We reached out to Jefferson Parish government for comment on the issue but the parish was not able to respond at this time.

Gov. John Bel Edwards’ office said it would reserve comment until it sees the final bill.

Copyright 2017 WVUE. All rights reserved.

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