This segment of What’s Ahead lays out a tax idea that should please blue state Democrats bereft from the loss of the deduction for state and local taxes, or what is dubbed SALT.
Congressional Democrats are feverishly trying to figure out a way to restore the SALT deduction that was virtually eliminated in the 2017 tax cut bill.
The best solution, of course, is a flat tax. Its low rate would easily make up for the loss of SALT.
Critics have always charged—falsely—that a flat tax is a giveaway to the rich. But what in the world would restoration of the SALT deduction be?
The blunt truth is that very wealthy Democrats from high-tax states are big Party donors, and they are pressuring their congressional representatives to get this deduction reinstated.
A flat tax would be the best of all worlds: Commerce would flourish; SALT wouldn’t matter anymore, because everyone would get a tax cut; and tax revenues would go up.