New York, New Jersey, Connecticut and Maryland sued the federal government over the Republican-led tax overhaul Tuesday, alleging the new law championed by President Donald Trump unfairly singles out high-tax blue states.
The lawsuit, filed in the Southern District of New York, was dismissed as a long-shot political stunt by supporters of the new tax code, but New York Gov. Andrew Cuomo said it is a practical act of self-defense against an adversarial federal government. The challenge alleges that lawmakers crafted the new tax code to target left-leaning states and interferes with their constitutionally granted taxing authority.
“This is their political attempt to hurt Democratic states,” said Cuomo, a Democrat who is considered a possible White House contender in 2020. “It’s totally repugnant.”
The tax law passed by Congressional Republicans and signed into law last year by Trump caps a deduction for state and local taxes at $10,000. The deduction was especially popular in high-tax, Democratic states, where many homeowners will see big increases in their federal tax bill. New York estimates that taxpayers will pay $14 billion more in 2018.
The suit seeks to block the cap on deductions for state and local taxes, known as SALT. It names the Internal Revenue Service and the U.S. Treasury Department as defendants. Cuomo first announced plans to sue seven months ago and was quickly joined by leaders from the other states.