SALT deduction battle heats up between House, Senate Republicans
House Republicans in Democrat-controlled states are sending a strong message to the Senate as it considers President Donald Trump’s “one big, beautiful bill.” GOP lawmakers in New York and California are adamant that the Senate should leave the House’s increased state and local tax (SALT) deduction cap in the bill, despite the Senate eyeing it as an opportunity to save taxpayer dollars.
The SALT deduction allows individuals living in areas with high state and local taxes to deduct those taxes in their federal tax filings, up to a certain point. House Republicans in blue states argue that raising the current $10,000 SALT deduction cap is crucial to providing tax relief to residents in high-cost-of-living areas.
Co-chairs of the SALT Caucus, Reps. Young Kim from California and Andrew Garbarino from New York, emphasized the importance of the SALT deduction cap in a statement. They stated, “When did taxing income that’s already been taxed become a Republican ideal? Our party has always stood for lower taxes and a fair, commonsense tax code. We worked in good faith with House leadership to secure a fair deal that provides our constituents with much-needed SALT relief.”
The House-passed budget reconciliation bill raises the SALT deduction cap to $40,000, a move that has garnered support from various groups, including firefighters, police, small businesses, and working Americans. Members of the SALT Caucus are firm in their stance that the Senate should not alter the negotiated SALT deduction cap, as it aligns with Republican principles of allowing taxpayers to keep more of their hard-earned money.
In New York, Rep. Nicole Malliotakis, a member of the SALT Caucus, emphasized the need for taxpayers in SALT states to avoid being double-taxed by their government. She highlighted the significant savings achieved by eliminating waste, fraud, and abuse in states, underscoring the importance of the increased SALT deduction cap.
Rep. Mike Lawler from New York echoed Malliotakis’ sentiments, stating that the issue of double taxation is not a partisan one but a matter of fairness. He warned that he would not support the bill if the Senate reinstated the lower SALT deduction cap, emphasizing that Republicans should not advocate for taxing individuals on top of taxes already paid.
Senate Majority Leader John Thune acknowledged that SALT is a key issue for House Republicans in blue states but noted that it is not a priority for Senate Republicans, who predominantly represent low-tax states. Thune emphasized that low-tax states should not subsidize high-tax states, highlighting the differing perspectives between the two chambers.
While Senate Republicans may not prioritize the SALT issue, Senate leadership recognizes the need to ensure that any changes to the budget bill align with the House’s priorities. Speaker Mike Johnson has urged the Senate to leave the bill intact, emphasizing the delicate balance that must be maintained to secure support from House members.
In conclusion, House Republicans in blue states are standing firm on the need to raise the SALT deduction cap in the budget bill, citing it as essential for providing tax relief to residents in high-cost-of-living areas. As the Senate considers modifications to the bill, it must navigate the differing perspectives between the two chambers to ensure a successful outcome that meets the needs of all taxpayers.
