New York Governor Questions the Constitutionality of Federal Tax Overhaul

"Politics does not trump the law," Cuomo said.

REUTERS

(Reuters) — The new U.S. tax code targets high-tax states and may be unconstitutional, New York Gov. Andrew Cuomo said on Thursday, saying that the bill may violate New York residents' rights to due process and equal protection.


The sweeping Republican tax bill signed into law by President Donald Trump on Friday introduces a cap, of $10,000, on deductions of state and local income and property taxes, known as SALT. The tax overhaul was the party's first major legislative victory since Trump took office in January.

The SALT provision will hit many taxpayers in states with high incomes, high property values and high taxes, like New York, New Jersey and California. Those states are generally Democratic-leaning.

"I'm not even sure what they did is legally constitutional and that's something we're looking at now," Cuomo said in an interview with CNN.

In an interview with CNBC, Cuomo suggested why the bill may be unconstitutional.

"Politics does not trump the law," Cuomo said on CNBC. "You have the constitution, you have the law, you have due process, you have equal protection. You can't use politics just because the majority controls to override the law."

The Fifth Amendment of the Constitution, better known for its protection against self-incrimination, also protects individuals from seizure of life, liberty or property without due process and has been interpreted by the Supreme Court as guaranteeing equal protection by the law.

Cuomo and California Gov. Jerry Brown, both Democrats, have previously said they were exploring legal challenges to SALT deduction limits.

Law professors have said legal challenges would likely rest on arguing that the provision interferes with the protection of states' rights under the U.S. Constitution's 10th Amendment.

Tax attorneys said Cuomo's legal argument against the tax bill could be that it discriminates and places an unjust tax burden on states that heavily voted for Democrats in the past — known as "blue states."

"The de facto effect of this legislation is to discriminate against blue states and particularly from [Cuomo's] perspective the state of New York," said Joseph Callahan, an attorney with the law firm Mackay, Caswell & Callahan in New York.

But some tax experts noted the U.S. Supreme Court has interpreted the 16th Amendment to give Congress broad latitude to tax as it sees fit. In a frequently cited 1934 decision, the Supreme Court called tax deductions a "legislative grace" rather than a vested right.

"I don't understand how they think they have a valid lawsuit here," David Gamage, a professor of tax law at Indiana University's Maurer School of Law, told Reuters last week, speaking generally about governors in blue states that could challenge the tax bill.

Cuomo also said on Thursday that New York is proposing a restructuring of its tax code. He provided no details.

A group of 13 law professors on Dec. 18 published a paper suggesting ways that high-tax states could minimize the effects of the SALT deduction cap.

Their suggestions included shifting more of the tax burden onto businesses in the form of higher employer-side payroll taxes, since the federal tax bill's cap on SALT deductions only applies to individuals and not businesses. States also could raise taxes on pass-through entities, which the federal tax bill specifically benefits with a lower rate on a portion of their income.

On Friday, Cuomo said he would allow state residents to make a partial or full pre-payment on their property tax bill before Jan. 1, allowing taxpapyers to deduct such payments for 2017 before the cap kicks in, prompting a wave of residents to pay early.

However, the U.S. Internal Revenue Service on Wednesday advised homeowners that the pre-payment of 2018 property taxes may not be deductible.

Read more news @ DiversityInc.com

Chicago's Gun-toting Students Outnumber Those of New York, Los Angeles: Study

Students in Chicago also reported being exposed to a higher level of risk factors for violence, such as bullying, schoolyard fights, drug abuse and even general feelings of despair.

Nortasha Stingiey (2nd L) hold hands in a group prayer during a news conference by "Purpose over Pain," a group of mothers who lost children to gun violence, calling for a stop to shootings in Chicago, Ill., May 6, 2016. / REUTERS

(Reuters) — Chicago high school students were far more likely to report carrying a firearm in recent years than their peers in New York and Los Angeles, a probable factor in Chicago's 2016-17 spike in gun violence, a study showed on Thursday.

Read More Show Less

New York Governor to Allow 35,000 Paroled Felons to Vote

"They work, pay taxes, and support their families, and they should be permitted to express their opinions about the choices facing their communities through their votes, just as all citizens do," Cuomo said in a statement.

REUTERS

(Reuters) — New York State plans to restore voting rights to about 35,000 New York felons on parole who previously were barred from casting a ballot until they completed their parole, Gov. Andrew Cuomo said on Wednesday.

Read More Show Less

New York's 'Fearless Girl' to Stare Down the Stock Exchange

"Fearless Girl," whose message is for a bigger role for women in corporate America and whose appearance in lower Manhattan on the eve of International Women's Day last year sparked a social media sensation, will be moved by the end of 2018.

REUTERS

(Reuters) — The bronze statue of a little girl that became a tourism phenomenon by staring down Wall Street's massive "Charging Bull" sculpture is to be moved to a nearby spot where its stern gaze will be on the male-dominated New York Stock Exchange, city officials said on Thursday.

Read More Show Less

New York Governor Presses Banks, Insurers to Weigh Risk of NRA Ties

"This is not just a matter of reputation, it is a matter of public safety," Cuomo said in a statement.

Gov. Andrew Cuomo (D-N.Y.) / REUTERS

(Reuters) — New York Gov. Andrew Cuomo on Thursday ramped up pressure on banks and insurers to revisit whether their ties to the National Rifle Association and other gun rights groups harm their reputations and the public interest.

Read More Show Less

New York Attorney General Wants Power to Bypass Trump Pardons

A change could make it more difficult for Trump aides and others who might be pardoned to escape criminal prosecution.

New York Attorney General Eric Schneiderman / REUTERS

(Reuters) — New York's attorney general on Wednesday asked Gov. Andrew Cuomo and state legislators to give him and other local prosecutors power to bring criminal charges against people pardoned by President Donald Trump.

Read More Show Less

Senate Panel To Hold Hearing On Sexual Abuse Of Olympic Athletes

The scandal prompted the entire board of directors at USA Gymnastics and the president and athletic director of Michigan State University to resign. It also spawned lawsuits and criminal and civil investigations.

REUTERS

(Reuters) — The U.S. Senate will hold a hearing next week into how the U.S. Olympic Committee, USA Gymnastics and other sports organizations handled sexual misconduct allegations.

Read More Show Less

Actors' Union Calls for End to Meetings in Private Hotel Rooms

SAG-AFTRA President Gabrielle Carteris said in a statement posted on the union's website, "We are committed to addressing the scenario that has allowed predators to exploit performers behind closed doors under the guise of a professional meeting."

REUTERS

(Reuters) — The United States' largest actors' union on Thursday called for an end to auditions and professional meetings in private hotel rooms and residences to protect its members from "potential harassment or exploitation."

Read More Show Less