Attorney general joins lawsuit against Biden stimulus plan – Cache Valley Daily

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Attorney general joins lawsuit against Biden stimulus plan – Cache Valley Daily

Utah Attorney General Sean Reyes has partnered with senior lawyers from 12 other states in a lawsuit against provisions of the American Rescue Plan Act that prohibit states from taking tax cuts (Image courtesy of icma.org).

SALT LAKE CITY – Utah Attorney General Sean Reyes, along with 12 other state lawyers, has filed a federal lawsuit over provisions in President Joe Biden’s $ 1.9 trillion COVID-19 stimulus plan that could potentially prohibit states from to give their citizens tax cuts.

“I don’t even know if it’s constitutional to do this,” Rep. Dan Johnson (R District 4) said recently in a virtual town hall. “But I kind of think that (Democrats in Congress) think they can do what they want.”

Thirteen attorneys general agree with Johnson that the provision in the American Rescue Plan Act is an unconstitutional violation of state sovereignty. Her lawsuit, filed in the US District Court in Alabama, seeks to remove that provision of the Biden Plan.

This lawsuit is about the $ 100 million tax cut for some Utahns who have already passed Utah legislation and signed into law by Governor Spencer Cox.

“Utah law recently granted families with children, veterans, and elderly residents receiving social security benefits $ 100 million in tax breaks,” Reyes said in a statement of his decision to join the lawsuit. “But that relief is now in jeopardy because the American Rescue Plan Act may deny states the ability to cut taxes.”

Biden signed the budget bailout bill in mid-March, just days after Utah Cox legislature submitted its tax cut proposal for approval.

Attorneys General, including Reyes, are concerned about a provision in the fine print of the American Rescue Plan Act that prohibits states from using their funds “directly or indirectly” to provide tax breaks to their citizens.

The Biden plan also threatens to withdraw its stimulus funds dollar by dollar to punish current or future tax cuts. With the law running until 2024, Utah state officials fear that any ambiguity in the COVID-19 relief plan could result in a price of up to $ 400 million for Utah’s proposed tax cut.

The controversial American Rescue Plan Act passed without a single GOP supporter in Congress, as Republicans argue that less than 10 percent of the $ 1.9 trillion price tag is spent on health care expenses from COVID-19 and only 1 percent will be used for vaccinations distribution.

However, fiscal analysts at the University of Utah’s Kem C. Gardner Institute estimate that Utah can get up to $ 8 billion from the stimulus package. About half of that amount will go to individual Utahns in the form of direct payments of $ 1,400, which are already being made into more than 80 percent of the nation’s households.

State officials estimate that Utah will receive about $ 2.7 billion in additional federal funding, with about $ 1.5 billion earmarked for the state and about $ 1.1 billion going to local governments. The remaining $ 1 billion will fund capital projects.

The states allied with Utah in the American Rescue Plan Act lawsuit are Alabama, Alaska, Arkansas, Florida, Iowa, Kansas, Montana, New Hampshire, Oklahoma, South Carolina, South Dakota, and West Virginia.