Latest news with #SALTCaucus
The Hill
9 hours ago
- Business
- The Hill
Don't pass a ‘Big Beautiful Blue-State Bailout' bill
As the Senate considers the One Big Beautiful Bill Act, blue state Republican House members are pledging to hold $4 trillion in tax relief hostage if the state and local tax or SALT deduction provision in the House-passed version is altered. The current language of the bill allows up to $40,000 in federal tax deductions for state and local tax expenses. Capping the SALT deduction at $10,000 was a big achievement of the 2017 tax bill. SALT is a blue state giveaway that shields politicians in high-tax states from accountability. Eliminating it entirely would pressure these governments to reform their fiscal ways. Although the House-passed bill thankfully would prevent a massive tax hike on millions of Americans, this egregious provision must be fixed in the Senate. SALT rigs the tax code in favor of the worst-managed states, forcing taxpayers in Florida and Texas to pick up the tab for New York City, Chicago, and San Francisco. This is simply unjust and antithetical to the very purpose of the tax code. Under current law, taxpayers who itemize can deduct up to $10,000 of SALT from their federal taxable income, reducing their federal tax bill. Capping this giveaway was an important policy win of the Trump-Pence Tax Cuts and Jobs Act and paid for lowering the corporate tax rate. But even with the current limits, taxpayers in fiscally responsible states are subsidizing bloated governments elsewhere. For high-income earners, this deduction reduces federal taxes owed by more than $400 for every $1,000 in state and local taxes paid. Instead of being content with the wildly generous $10,000 deduction, the SALT Caucus demands a dramatic lifting of the cap — or else subject Americans to the trillions of dollars in tax increases in 2026. Voters in places like California and New York continue to elect politicians who overspend and overtax in a vicious cycle that leaves American families picking up the tab. Constituents of the SALT Caucus should focus their energy on restoring fiscal sanity to their own states before asking Texas, Florida, and the rest of middle America to pick up the tab. Unsurprisingly, before the cap was imposed in 2017, California and New York (population 59 million) received 33 percent of SALT benefits while less than 7 percent of such benefits went to residents of Florida and Texas (combined population: 55 million). Thanks to SALT, Blue state residents pay thousands less in federal taxes per year. To illustrate a SALT deduction with a proposed $40,000 cap, consider two hypothetical families — one in New Jersey and one in Tennessee. Both are married with $400,000 personal income each year, spending $100,000 on consumer goods, with a residence worth $700,000. The family in Tennessee family would pay $11,060 in state and local taxes per year, with a SALT deduction value of $3,539. The family in New Jersey would pay $36,920 in state and local taxes per year, with a SALT deduction of $11,814. The SALT subsidy results in our Tennessee family paying a whopping $8,275 more in federal taxes than its counterpart in New Jersey. This family is funding public schools, roads, police, and fire not only in the Volunteer State but in the Garden State as well! Millions of American families have left New York, New Jersey, and California for lower-tax states. Meanwhile, the SALT Caucus insists these political refugees fund the very, bloated governments from which they fled. SALT subsidy proponents denounce repeal as a federal 'revenue grab.' But making the current $10,000 SALT cap permanent would turbocharge the economy by providing nearly $1 trillion over the next decade for broad-based permanent tax cuts. Rep. Mike Lawler (R-N.Y.) derides SALT repeal as 'double taxation.' He is wrong on two counts. True double taxation occurs when one level of government taxes the same income twice, like corporate income taxes followed by dividend taxes, which both hit shareholders. But federal and state taxes are levied by two distinct sovereign entities with distinct constitutional roles providing distinct public services. The only 'double taxation' related to SALT is that it requires Tennessee taxpayers to foot the bill of their own state, plus a legion of big-spending Blue states. Without the SALT deduction, taxpayers in high-tax states like New Jersey — burdened by public sector unions, corruption, and fiscal malfeasance — would feel the full weight of their states' policies. Residents would surely demand lower taxes and smarter budgets. Congress should prioritize job creators, investors, and workers rather than entrenched state bureaucracies. The tax code should reward innovation rather than reward egregiously high state and local taxes. It's time to end — not expand — the SALT deduction. Paul Teller is executive vice president of Advancing American Freedom, where Joel Griffith is a senior fellow.
The Hill
12 hours ago
- Business
- The Hill
Impasse over SALT cap deepens as House moderates stand firm
The impasse over the state and local tax (SALT) deduction cap is deepening as Senate Republicans and House moderates from high-tax blue states remain at a loggerheads, a stalled state-of-play that is threatening to thwart leadership's goal of enacting the party's 'big, beautiful bill' by July 4. Sen. Markwayne Mullin (R-Okla.) — a former House member and key liaison between Republicans in both chambers — spoke with a group of House GOP lawmakers in the SALT Caucus on Wednesday to discuss the issue, two sources familiar with the matter told The Hill, as top lawmakers hunt for a consensus on the cross-Capitol debate. Reps. Mike Lawler (R-N.Y.), Andrew Garbarino (R-N.Y.), Young Kim (R-Calif.) and Tom Kean Jr. (R-N.J.) were present, according to one of the sources. Leaders are trying to bridge the gap between the House's $40,000 SALT deduction cap for individuals making $500,000 or less and the Senate's proposal for a $10,000 cap, which matches the number in current law. SALT Caucus members have deemed the Senate's offer a nonstarter and are demanding that the House deal — which was the product of months-long negotiations with Speaker Mike Johnson (R-La.) — remains in the final product. After Wednesday's call, progress appeared elusive. 'We're still working on a deal. We're still running numbers on things. … A little premature, and I hope [the leaks] didn't damage us moving forward,' Mullin told The Hill on Thursday. 'We're not there. … We're in a good spot. We're not in a final spot.' The leak Mullin referred to was a report from Punchbowl News that the senator and SALT Caucus Republicans discussed keeping the $40,000 deduction cap in place but decreasing the income threshold from $500,000 — which would still allow filers a larger SALT deduction but limit it for higher-income earners, bringing down the price tag for the provision. Key SALT Caucus Republicans, however, are rejecting that idea, showing zero appetite for tampering with the deal they landed last month. 'The bottom line here is the Senate has a position of $10,000 — we're not accepting that,' Lawler told The Hill on Thursday. 'That's the reality. Never gonna vote for that bill.' Asked if he was open to negotiating to bring down the $500,000 income cap, Lawler responded: 'No, look, we negotiated our deal, this is the deal.' 'They need to just accept that this is the deal,' he added. 'This is the deal that we negotiated, and they should abide by it.' Rep. Nick LaLota (R-N.Y.), another vocal member of the SALT Caucus, sounded a similar note, telling The Hill that the compromise the group closed in June 'shouldn't be touched.' 'It earned the votes of Republicans with very different world views and to change it is to risk losing votes and tanking the whole bill,' he added. The New York Republican shut down any chance of changing the $500,000 income cap: 'I am done negotiating,' he said when pressed on if it was open to discussion. Senate Majority Leader John Thune (R-S.D.), to be sure, has said that the $10,000 cap in the Finance Committee's part of the megabill is a 'marker' for negotiations going forward, noting that the House and Senate will 'figure out a landing spot.' But moderate Republicans from high-tax blue states — including New York, New Jersey and California — are showing no interest in more talks and instead want the Senate to stick with their deal. The group is warning that they will vote against a bill that contains a $10,000 deduction cap — enough opposition to sink the entire package full of President Trump's legislative priorities. 'Restoring SALT is not about New Jersey alone. It is about fixing a flaw in the federal tax code that stifles growth, undermines local control, and violates the conservative belief in fair, limited taxation. $40k is the right compromise,' Kean Jr. wrote on X this week in response to the Senate's proposal. 'No SALT, no deal.' The current dynamics do not come as a surprise. House Republicans in the SALT Caucus for years have pushed to increase the $10,000 deduction cap in current law, decrying the 2017 Tax Cuts and Jobs Act for implementing the limit in the first place. They saw deliberations over the 'big, beautiful bill' as their time to deliver for their constituents, and negotiated the $40,000 deduction cap for individuals making $500,000 or less. But with no Senate Republicans from high-tax blue states, SALT does not have a champion in the upper chamber — and Senate Republicans, as a result, are trying to change the costly provision. 'There's not one Republican in the United States Senate who gives a s— about SALT,' a former House member, said last month. 'Having said that, what does matter is 218 votes in the House, and we want to be cognizant about that.' The deadlock, however, is dragging on into dangerous territory for Republican leaders on Capitol Hill: Top lawmakers are under heavy pressure to enact the 'big, beautiful bill' by July 4, a deadline the administration has gotten behind. White House chief of staff Susie Wiles told Senate Republicans during their weekly lunch this week that the president wants the megabill on his desk by Independence Day. Despite that due date, SALT Republicans are showing no signs of relenting on their demand for the House deal. In fact, the calendar is on their side: If the 2017 Trump tax cuts expire without a deal on SALT, the deduction cap snaps back to being unlimited — a reality they would be elated with. 'The Senate's choice is simple,' LaLota said. '[A]dopt the House's $40,000 SALT compromise—or risk blowing up the [One Big, Beautiful Bill Act], letting SALT go back to unlimited, and watching the Trump tax cuts expire.' Lawler echoed that sentiment, arguing that the House deal is the only agreement that will land the SALT Caucus's support. 'By agreeing to a cap we are providing our colleagues the ability to pay for other provisions including the doubling of the standard deduction, the no tax on tips, no tax on overtime, the enhanced child tax credit. So this is the deal,' he said. 'This is what was agreed upon.' Al Weaver contributed.
Yahoo
3 days ago
- Business
- Yahoo
SALT Caucus Republicans seethe at $10K cap in Senate's ‘big, beautiful bill'
Moderate House Republicans from high-tax blue states are seething at the Senate's proposal to keep the state and local tax (SALT) deduction cap at $10,000, setting the stage for a showdown over one of the thorniest aspects of the GOP's 'big, beautiful bill.' Republicans on the Senate Finance Committee set off a frenzy Monday afternoon when they released text for their part of the GOP megabill, which lowered the SALT deduction cap from $40,000 — the product of tenuous negotiations between House moderates and Speaker Mike Johnson (R-La.) — to $10,000, matching the cap in current law. Senate Republicans have said that the number in the text is merely a placeholder to continue negotiations across the Capitol. But House Republicans in the SALT Caucus are warning in no uncertain terms that they will not accept anything lower than the $40,000 deduction cap they landed last month. 'We have been crystal clear that the SALT deal we negotiated in good faith with the Speaker and the White House must remain in the final bill,' Reps. Andrew Garbarino (R-N.Y.) and Young Kim (R-Calif.), co-chairs of the SALT Caucus, wrote in a statement. 'Instead of undermining the deal already in place and putting the entire bill at risk, the Senate should work with us to keep our promise of historic tax relief and deliver on our Republican agenda.' Rep. Mike Lawler (R-N.Y.), another key member of the group, was more succinct, writing on the social platform X that the proposal was 'DEAD ON ARRIVAL' and warning in a statement that a $40,000 deduction cap 'is the deal and I will not accept a penny less.' 'If the Senate reduces the SALT number, I will vote NO and the bill will fail in the House,' he added. Senate Majority Leader John Thune (R-S.D.) told reporters Monday afternoon that the $10,000 deduction cap is a 'marker' for talks with House Republicans, and that they will find a number in the middle that satisfies both camps. 'We understand that it's a negotiation,' Thune said. 'Obviously there had to be some marker in the bill to start with. But we're prepared to have discussions with our colleagues here in the Senate and figure out a landing spot.' If a deduction cap below $40,000 remains in the bill, and Senate Republicans approve it, the legislation is unlikely to pass the House, where it must go for final approval before landing on President Trump's desk. House Republicans can only afford to lose three votes and still pass the bill — assuming full attendance and all Democrats vote 'no' — and far more have come out against the new SALT provision. 'The Senate doesn't have the votes for $10k SALT in the House,' Rep. Nick LaLota (R-N.Y.), a vocal member of the SALT Caucus, wrote on X, with a photo of Daveed Diggs portraying Thomas Jefferson in 'Hamilton' and a caption reading 'you don't have the votes; you don't have the votes.' 'And if they're not sold on the House's $40k compromise, wait until they crash the [One Big Beautiful Bill Act] and [Tax Cuts and Jobs Act] expires—when SALT goes back to unlimited at year-end,' he added. 'They won't like that one bit.' Rep. Elise Stefanik (R-N.Y.) wrote on X that 'Everyone knows this 10K number will have to go up. And it will. NY Republicans will fight and deliver real tax relief for our overly taxed constituents (unlike NY Democrats who have failed the people of NY over and over crushing them with high taxes).' SALT for months has been one of the most contentious parts of the GOP's bill full of Trump's legislative priorities, with moderate House Republicans from high-tax blue states — including representatives from New York, New Jersey and California, many of whom helped secure the conference's majority — pushing for a higher deduction cap, and deficit hawks pressing to keep it low. After months of negotiations, members of the House's SALT Caucus landed a deal with leadership for a $40,000 deduction cap for individuals making $500,000 or less — quadruple the current $10,000 deduction cap. They warned their colleagues in the upper chamber not to tamper with the number. Johnson, who negotiated the $40,000 deduction cap with members of the SALT Caucus, said he urged the Senate on a number of occasions to be 'cautious' in how it changed their bill, especially the SALT provision. 'I've been very consistent from the very beginning: I've encouraged them to be very cautious in changing terms of the bill, especially on SALT because it took us, as I've said over and over and over, it took us over a year to negotiate those terms, and it's very delicate,' he said last week. But once Senate Republicans got their hands on the package, they quickly warned that they would lower the number, staking opposition to the higher deduction cap that they view as an unfair subsidy for blue states. With zero Senate Republicans hailing from blue states that benefit from a higher SALT deduction cap, the issue has no champion in the upper chamber. It remains unclear where SALT conversations will go from here. With the party's July 4 deadline quickly approaching, Senate Republicans can still change parts of their package, whether it be through an amendment or on the floor. Even so, SALT Caucus Republicans in the House are warning that they are sticking by the $40,000 cap. 'The $40,000 SALT deduction was carefully negotiated along with other tax provisions by the House of Representatives and we all had to give a little to obtain the votes to pass the Big Beautiful Bill,' Rep. Nicole Malliotakis (R-N.Y.) wrote on X. 'For the Senate to leave the SALT deduction capped at $10,000 is not only insulting but a slap in the face to the Republican districts that delivered our majority and trifecta.' 'We understand that it's a negotiation. Obviously there had to be some marker in the bill to start with. But we're prepared to have discussions with our colleagues here in the Senate and figure out a landing spot.' Al Weaver contributed. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
The Hill
4 days ago
- Business
- The Hill
SALT Caucus Republicans seethe at $10,000 cap in Senate's ‘big, beautiful bill'
Moderate House Republicans from high-tax blue states are seething at the Senate's proposal to keep the state and local tax (SALT) deduction cap at $10,000, setting the stage for a showdown over one of the thorniest aspects of the GOP's 'big, beautiful bill.' Republicans on the Senate Finance Committee set off a frenzy Monday afternoon when they released text for their part of the GOP megabill, which lowered the SALT deduction cap from $40,000 — the product of tenuous negotiations between House moderates and Speaker Mike Johnson (R-La.) — to $10,000, matching the cap in current law. Senate Republicans have said that the number in the text is merely a placeholder to continue negotiations across the Capitol. But House Republicans in the SALT Caucus are warning in no uncertain terms that they will not accept anything lower than the $40,000 deduction cap they landed last month. 'We have been crystal clear that the SALT deal we negotiated in good faith with the Speaker and the White House must remain in the final bill,' Reps. Andrew Garbarino (R-N.Y.) and Young Kim (R-Calif.), co-chairs of the SALT Caucus, wrote in a statement. 'Instead of undermining the deal already in place and putting the entire bill at risk, the Senate should work with us to keep our promise of historic tax relief and deliver on our Republican agenda.' Rep. Mike Lawler (R-N.Y.), another key member of the group, was more succinct, writing on X that the proposal was 'DEAD ON ARRIVAL,' and warning in a statement that a $40,000 deduction cap 'is the deal and I will not accept a penny less.' 'If the Senate reduces the SALT number, I will vote NO and the bill will fail in the House,' he added. Senate Majority Leader John Thune (R-S.D.) told reporters Monday afternoon that the $10,000 deduction cap is a 'marker' for talks with House Republicans, and that they will find a number in the middle that satisfies both camps. 'We understand that it's a negotiation,' Thune said. 'Obviously there had to be some marker in the bill to start with. But we're prepared to have discussions with our colleagues here in the Senate and figure out a landing spot.' If a deduction cap below $40,000 remains in the bill, and Senate Republicans approve it, the legislation is unlikely to pass the House, where it must go for final approval before landing on President Trump's desk. House Republicans can only afford to lose three votes and still pass the bill — assuming full attendance and all Democrats vote 'no' — and far more have come out against the new SALT provision. 'The Senate doesn't have the votes for $10k SALT in the House,' Rep. Nick LaLota (R-N.Y.), a vocal member of the SALT Caucus, wrote on X, with a photo of Thomas Jefferson from 'Hamilton' and the caption 'you don't have the votes; you don't have the votes.' 'And if they're not sold on the House's $40k compromise, wait until they crash the [One Big Beautiful Bill Act] and [Tax Cuts and Jobs Act] expires—when SALT goes back to unlimited at year-end,' he added. 'They won't like that one bit.' Rep. Elise Stefanik (R-N.Y.) wrote on X that 'Everyone knows this 10K number will have to go up. And it will. NY Republicans will fight and deliver real tax relief for our overly taxed constituents (unlike NY Democrats who have failed the people of NY over and over crushing them with high taxes).' SALT for months has been one of the most difficult parts of the GOP's bill full of Trump's legislative priorities, with moderate House Republicans from high-tax blue states — including New York, New Jersey and California, many of whom helped secure the conference's majority — pushing for a higher deduction cap, and deficit hawks pressing to keep it low. After months of negotiations, members of the House's SALT Caucus landed a deal with leadership for a $40,000 deduction cap for individuals making $500,000 or less — quadruple the current $10,000 deduction cap. They warned their colleagues in the upper chamber not to tamper with the number. Johnson, who negotiated the $40,000 deduction cap with members of the SALT Caucus, said he urged the Senate on a number of occasions to be 'cautious' in how it changed their bill, especially the SALT provision.' 'I've been very consistent from the very beginning: I've encouraged them to be very cautious in changing terms of the bill, especially on SALT because it took us, as I've said over and over and over, it took us over a year to negotiate those terms, and it's very delicate,' he said last week. But once Senate Republicans got their hands on the package, they quickly warned that they would lower the number, staking opposition to the higher deduction cap that they view as an unfair subsidy for blue states. With zero Senate Republicans hailing from blue states that benefit from a higher SALT deduction cap, the issue had no champion in the upper chamber. It remains unclear where SALT conversations will go from here. With the party's July 4 deadline quickly approaching, Senate Republicans can still change parts of their package, whether it be through an amendment or on the floor. Even so, however, SALT Caucus Republicans in the House are warning that they are sticking by the $40,000 cap. 'The $40,000 SALT deduction was carefully negotiated along with other tax provisions by the House of Representatives and we all had to give a little to obtain the votes to pass the Big Beautiful Bill,' Rep. Nicole Malliotakis (R-N.Y.) wrote on X. 'For the Senate to leave the SALT deduction capped at $10,000 is not only insulting but a slap in the face to the Republican districts that delivered our majority and trifecta.' 'We understand that it's a negotiation. Obviously there had to be some marker in the bill to start with. But we're prepared to have discussions with our colleagues here in the Senate and figure out a landing spot.' Al Weaver contributed.
Yahoo
05-06-2025
- Business
- Yahoo
House Republicans warn Senate not to touch SALT deal
Moderate House Republicans from high-tax blue states are warning senators that they will not give the 'big, beautiful bill' a final stamp of approval if the Senate changes their proposal for the state and local tax (SALT) deduction cap. The shot across the Capitol came shortly after Senate Majority Leader John Thune (R-S.D.) told reporters the upper chamber would likely tweak the SALT provision in the mammoth measure in one of several alterations. The House bill raises the SALT deduction cap to $40,000 — quadruple the $10,000 deduction cap in current law. Several moderates in the House from New York, New Jersey and California have said they would not support the package unless it included substantial SALT relief. Those members are now warning that any changes to the provision could prevent the bill from passing the House once it is sent back from the Senate. 'If the Senate unwinds the House's $40K SALT deal, it's like digging up buried radioactive waste—reckless and sure to contaminate the whole One Big Beautiful Bill,' Rep. Nick LaLota (R-N.Y.) wrote on social platform X. 'Best to leave it alone.' He elaborated on his comments later, telling reporters he would encourage the Senate to keep their deal in place. 'The reason I've chosen that analogy is because the House took four months to get to where we could finally compromise, negotiate and settle on bill language as it relates to SALT and other interlocking and related provisions. So the Senate to disrupt that is to undo a lot of that painful work, to rip off some scabs, and to essentially restart the very painful process that we went through for four months,' he said. 'I would advise them to keep the bill intact. I respect the senators' prerogatives to exercise their constituents' priorities, but we worked really hard to get to the compromise bill that we got to, and it'd be a shame to have to restart.' Rep. Mike Lawler (R-N.Y.), another member of the group, was more concise: 'Let's be clear — no SALT, no deal.' 'If the Senate changes the negotiated number of $40,000 — it will derail final passage of the bill,' Lawler wrote on X. Speaker Mike Johnson (R-La.), who was a key player in brokering a SALT deal in the House, said he spoke with members of the caucus on Wednesday, shortly after Thune signaled changes to their provision, and plans to make their case to the Senate. 'I just talked to my SALT Caucus on the floor and I'm going to go communicate to the Senate, again, it's a very delicate thing, we have to maintain the equilibrium point that we reached in the House,' Johnson told reporters. 'And it took almost a year to get to that point, so I don't think we can toss that off.' Asked if there is wiggle room around the $40,000 deduction cap, the Speaker was coy: 'I'm about to find out; we'll see.' The SALT deduction cap was always expected to be a battle in the Senate. While a number of vulnerable Republicans in the House care deeply about SALT, Senate Republicans don't even have members from New York, New Jersey or California. The issue came up for Senate Republicans at a conference-wide meeting Wednesday, where some were itching to lower the cap but wary of gumming things up for Johnson. 'Our goal isn't to create a problem for the House, but we also know the Senate will put its mark on the bill,' Sen. Mike Rounds (R-S.D.) said. One Senate Republican indicated that some senators favor forcing the House SALT backers into supporting a lower ceiling but believe the easiest path is for the upper chamber to swallow its pride and defer to Johnson. 'It may be easier to say than do,' the Senate GOP member said. 'It would just screw the whole bill.' This senator said even lowering the ceiling from $40,000 to $30,000 could be risky since it might lead some of the House Republicans to vote against the bill. But the senator also suggested the SALT Republicans in the House could be bluffing. 'Is that enough to get you, because otherwise you say, 'I'm going to vote against the bill and for a $4 trillion tax increase as a Republican,'' the member continued. 'That's original sin there.' While Thune is signaling that the chamber will likely change the SALT provision, Sen. Markwayne Mullin (R-Okla.) — a former House member and key liaison between the two chambers — is saying the opposite. 'It was a hard fight over there,' Mullin said, pointing to its roughly $300 billion cost. 'It's a big number, but it was something they had to do to try to get the bill passed. We don't want to do something that would cause it not to pass.' 'The body here is going to work its will,' he continued. 'I would be a little [skeptical] about doing too much with SALT.' House Republicans in the SALT Caucus are warning they aren't bluffing. 'I wouldn't bet against a couple of salty Republicans, including a couple of salty New Yorkers,' LaLota said. 'I wouldn't bet against us.' Pressed on if the Senate should take the SALT Caucus's comments as a signal that the House will not pass a bill with a lower deduction cap, LaLota responded: 'That would be reasonable for them to consider that.' Rep. Young Kim (R-Calif.), another member of the SALT Caucus, expressed confidence. 'The leadership is working and talking to the Senate on a regular basis, and I'm very confident much of what we passed in the House will still be there,' Kim said. 'So I'm not going to comment on how I'll be voting for it till I see the package that comes back to us.' 'We're already working to ensure that everything that we pass in the House is still kept in the Senate version,' she added. Asked if there was any wiggle room on their SALT deal, LaLota said: 'I'm eager to see what they actually come back with. I don't know why anybody would logically want to disrupt something that was the result of a lot of hard work, pain, heartache and ultimately compromise,' he added. When a reporter pointed out that his comments were not a firm no, he responded: 'I would love them to increase it. That would be a great idea if they came to us with $50,000, I would endorse it right away.' Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
