Bipartisan Caucus Launches Renewed Battle for Middle-Class Tax Relief
WASHINGTON — Some familiar faces and a batch of newcomers to Capitol Hill are banding together to try to restore the state and local tax deduction and bring tax relief to millions of middle-class families.
A controversial part of former President Donald Trump’s 2017 tax overhaul, the SALT write-off cap, is costly for filers who itemize deductions and can’t claim more than $10,000 for property and state income taxes.
The limit has been especially burdensome to those in high-tax states, such as California, New Jersey and New York, and in response, former Rep. Tom Souzzi, D-N.Y., championed the formation of a SALT caucus with other House moderates to try to restore the tax break.
As a result of those efforts, since 2019, the House has passed legislation three times aimed at restoring the deduction, only to see the measure languish in the Senate.
On Wednesday afternoon, longtime members of the group, including Reps. Josh Gottheimer, D-N.J., and Mikie Sherrill, D-N.J., Andrew Garbarino, R-N.Y., and Anna Eshoo, D-Calif., were joined by fresh faces Mike Lawler, Anthony D’Esposito and Marc Molinaro, all Republicans and all from New York, among others to relaunch the caucus in the 118th Congress.
“For every member here, and for the millions of middle-class families we represent, it’s high time that Congress restores the state level tax deduction … and help make life more affordable for our families,” said Gottheimer, the group’s Democratic co-chair.
“If just tuning in on this issue, the 2017 tax cut gutted this deduction and since then has become the subject of a bit of a red states versus blue states [debate],” he continued. “But in my district, before 2015, a married couple making a typical salary — $216,000 or less — could save as much as $3,500 off their federal income taxes.
“This is not a rich person’s issue. This is a middle-class issue. And the bottom line is, if you’re against restoring SALT, then you are against lowering taxes,” he said.
An out-of-breath Garbarino, the Republican co-chair who had run from a committee meeting to the press conference outside the Capitol on a patch of grass and cement known as the House triangle, noted that in a little over two months, “We’re going to have Tax Day on April 18, and for another year our constituents are getting the short end of the stick.”
Garbarino observed that since the 104-year-old SALT deduction was eliminated, his neighbors have been spending $15,000 or more in property taxes each year.
“And these are not big homes,” he continued, having caught his breath. “A teacher who lives right across the street from me pays $17,000 a year in property tax, a fireman who lives just south of me pays $15,000 a year, as does a cop who lives to the north of me.
“These are not millionaires; these are working class people. And every year, they are getting screwed,” he said.
“This cap does expire in 2025, but I don’t want to wait that long to bring them relief,” Garbarino said.
“I’m happy that we are here in a bipartisan manner, so we can get a bipartisan fix. This affects all of our constituents. Hopefully, we’ll be able to find legislation we can all agree on to fix this,” he said.
Garbarino also vowed to stand up with his fellow caucus members to make sure that any proposed extension of the cap doesn’t happen.
“That is very important because people are already talking about it,” he said.
In past years opponents of bringing back the SALT deduction have argued it is a giveaway to wealthy individuals residing in high-cost-of-living states like New York, New Jersey, California and Illinois.
But the dynamics have shifted in Congress, and the results of the recent election in which Republicans flipped seats in New York and gave the GOP its current narrow edge in the House, could be the difference in having SALT-restoring legislation advance this year.
“Time is on our side,” Garbarino said. “SALT expires in 2025. Whatever happens before then, because the Senate is controlled by the Democrats, the White House is Democratic and the House is Republican, has to be bipartisan in nature.
“We’ve also just gotten a bunch of new members on the Republican side, members who determined the current House majority, so I think we have a pretty big seat at the table to discuss this issue.”
“I like the odds of having a bunch of new Republicans in the House from states seeking to restore SALT,” said Gottheimer, the Democrat.