America the Divisible: Local Taxes and the SALT Subsidy

Authors

Matthew S. Johnson

Abstract

The state and local tax (SALT) deduction subsidizes localities in a way that has not fully been appreciated by policymakers, practitioners, or academics. While the state portion of the SALT deduction captures headlines and receives significant attention from academics, the local portion has been overlooked. Local taxes introduce concerns that are not relevant to state-levied taxes. The local tax deduction provides a greater subsidy, per capita, for wealthy localities than it does for economically heterogeneous or less wealthy localities. This Note is the first to quantify the subsidy received by localities through the SALT deduction. This Note contributes to the literature by (1) examining the overlooked local portion of the SALT deduction, (2) quantifying the SALT subsidy received by localities, and (3) noting the impact of the Tax Cuts and Jobs Act on the SALT subsidy.

Rights

© 2022 Brigham Young University Law Review

Recommended Citation

Matthew S. Johnson, America the Divisible: Local Taxes and the SALT Subsidy, 48 BYU L. Rev. 687 (2022).
Available at: https://digitalcommons.law.byu.edu/lawreview/vol48/iss2/10