Three New York Democrats plan to introduce legislation require the Internal Revenue Service to modify tax brackets for people who reside in areas where the cost of living is high.
Reps. Jerry Nadler, Nita Lowey and Steve Israel announced the bill on Friday ahead of the federal tax filing deadline on April 15.
Under their proposal, the IRS would account for regional cost-of-living adjustments in individual income tax rates. The Labor Department would be responsible for determining a regional cost-of-living index for metropolitan areas.
{mosads}The lawmakers argued that taxpayers who live in places like New York City, where real estate is notoriously expensive, have to pay far more for necessities like housing or food than people in less costly regions.
“The Tax Equity Act is a practical approach to making tax burdens more fair, based on the actual local costs of living in New York, Houston, Miami, or wherever. The goal is simply to ensure that hard-working New Yorkers and others – the vast majority of whom are not wealthy – are treated fairly by the income tax system,” Nadler said in a statement.
They noted that on top of already high housing costs, many New Yorkers have to pay more in property taxes.
“Residents of the New York metropolitan area, including the counties of Westchester and Rockland, pay more for housing, food, and utilities, not to mention some of the highest property taxes in the country. Making ends meet is difficult in our region even for those with good jobs, and it’s only fair for the tax code to reflect that reality,” said Lowey, the top Democrat on the House Appropriations Committee.
Nadler previously introduced the bill in the last Congress, but it did not receive legislative action.