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The need for a fairer tax code

I think that Charles Lane [“The deduction to chop,” op-ed, Nov. 20] could benefit from spending some time in a state with a high cost of living such as New Jersey, which has the highest state and local tax burden in the country.

The area I represent includes three of the top 14 counties in the country with the highest property taxes. My constituents, who have an average annual income of $51,000, pay 15 percent of their income in property taxes and then must pay income taxes and other bills and save for such necessities as college or retirement.

Far from a “federal tax subsidy for ‘blue’ state governments,” New Jersey is the ultimate donor state, paying far more to the federal government in taxes than it gets back. We effectively subsidize states that have considerably lower property taxes.

Instead of asking New Jersey’s middle-class families to pay more so we can cut rates for the top 1 percent, we should listen to the voice of the voters and ask the wealthy to pay a little more by returning to the Clinton-era tax rates.

Bill Pascrell Jr., Paterson, N.J.

The writer, a Democrat, represents New Jersey’s 8th District in the House of Representatives. He was elected Nov. 6 to represent the new 9th District come January.

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Charles Lane argued that the “least defensible special break in the U.S. tax code” is the deduction for state and local taxes.

This position reflects a fundamental misunderstanding of the logic of the Internal Revenue Code. When a state imposes a tax on its citizens, that tax is a charge for the privilege of living and working in the state. It is not a personal expense — failure to pay the tax is a criminal act, punishable by imprisonment. The tax code simply acknowledges that, because the tax has been paid to the state, the funds are not available for taxation by the federal government.

The charitable deduction and mortgage interest deduction are, to the contrary, inherently personal expenses, reflecting individual choices that have nothing to do with any government payments or federal programs. In my opinion, the rationale for allowing these deductions is highly suspect.

Mr. Lane also stated that the state tax deduction is a “significant federal tax subsidy for ‘blue’ state governments.” The beneficiary states mentioned are California, New York, Connecticut, New Jersey, Illinois, Massachusetts and Maryland. It is interesting that even after the state tax deduction, the citizens of each of these states (with the exception of Maryland) pay far more into federal coffers than their states receive back, effectively subsidizing virtually every “red” state. In effect, the tax code acts as a mechanism to shift revenue from liberal to “fiercely independent” conservative states.

Ken Wood, Derwood

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