Proposed tax-rate cuts worry Jewish organizations

Jewish organizations are expressing concerns at cost-cutting proposals in President Barack Obama’s $3.8 trillion budget for 2013.

The Orthodox Union and the Jewish Federations of North America released statements objecting to the proposal, which would reduce the tax-deductibility rate of charitable donations for taxpayers earning more than $250,000 to 28 percent from the current 35 percent.

“Despite the fact that the White House had recently indicated that its tax reform proposals would not disincentivize large charitable gifts, today’s Budget release is disappointing for America’s charities and the millions we support, particularly during this time of economic distress,” William Daroff, vice president for public policy and director of JFNA’s Washington office, said in a statement.

JFNA noted last week that the Obama administration emphasized in its “Blueprint for an America Built to Last” that it would maintain the deductibility rate of charitable contributions.

The Orthodox Union said in its statement that the decision to reduce the rate to 28 percent could slash donations to American charities by $4 billion annually.

“The tax deductibility of charitable contributions is, apart from a person’s generosity of spirit, the most powerful tool America’s charities possess to raise funds that enable them to serve their brothers and sisters,” Nathan Diament, the OU’s executive director of public policy, said in the statement.

B’nai B’rith International and the Jewish Council for Public Affairs also released statements outlining their issues with provisions in the budget.

Allan Jacobs, president of B’nai B’rith, expressed his concern regarding affordable senior housing construction and urged Congress to “make sure that other savings associated with the program do not translate into unaffordable rent increases for low-income seniors.”

Prior to the release of the budget, JCPA organized a letter to Congress on Feb. 9 with signatories from 20 other Jewish organizations highlighting the budget priorities of the organized American Jewish community. They focused on deficit reduction, preventing spending cuts that could hurt disadvantaged Americans and providing robust assistance for Israel.

The proposed budget leaves Israel’s $3 billion in annual defense assistance intact but separately cuts joint missile defense programs with Israel by $6 million, to $100 million, according to reports. The Israeli daily Ha’aretz quoted U.S. officials as saying that Israel had been warned about the cuts.

Presidents routinely propose modest cuts in such programs; Congress routinely restores the cuts and usually adds to the budget. — jta