To say the new proposed tax plan at play in Congress could bring potentially adverse impacts for Houstonians would be putting it mildly.
This is because, according to analysts, the plan could put the burden on citizen to deduct the taxes they pay to the state of Texas and the city of Houston, and, according to tax experts, the Senate’s proposed elimination of the state and local tax deduction could result in a tax increase for close to 600,000 residents.
Meanwhile, they say it could also hinder the city’s ability to provide essential functions to its residents.
The state and local tax deduction is one known to be a part of the federal tax code for more than a century, but for the city of Houston, the deduction is essential in how it calculates its tax rate, according to Chris Brown, the city’s controller.
A repeal of the state and local deduction, per the Senate’s bill, could also put pressure on the city to lower local taxes because the federal rate would be high, tax analysts agree.