GOP Lawmakers Reject Proposal to Raise SALT Cap to $30,000

WASHINGTON — A quartet of Republican members from New York State have rejected a House Ways and Means Committee proposal to raise the state and local tax deduction cap to $30,000 to avoid an intra-party impasse preventing an extension of President Donald Trump’s 2017 tax cuts.

The pushback comes after days of talks between House Speaker Mike Johnson, R-La., and the dissident lawmakers, as GOP leaders in the chamber seek to guide the tax cut extension to a safe landing before it expires in December, avoiding a multitrillion-dollar tax increase on tens of millions of people and businesses across the country.

The so-called SALT deduction allows high-income taxpayers in states like New York, New Jersey and California to subtract state and local taxes from their taxable income. The rate has been capped at $10,000 since 2017 as part of Trump’s original tax cut plan, the sweeping Tax Cuts and Jobs Act.

Since then representatives from those states have been trying to either double the cap for married filers, index it to inflation or repeal it altogether, a move that could cost the U.S. Treasury as much as $1.2 trillion over the next decade.

In a statement released Thursday night, Reps. Mike Lawler, Elise Stefanik, Andrew Garbarino and Nick LaLota, all Republicans, said the proposal to raise the cap to $30,000 is “not just insulting” but “risks derailing President Trump’s one big beautiful bill.”

“We’ve negotiated in good faith on SALT from the start — fighting for the taxpayers we represent in New York,” they said. “Yet with no notice or agreement, the speaker and the House Ways and Means Committee unilaterally proposed a flat $30,000 SALT cap — an amount they already knew would fall short of earning our support.

“New Yorkers already send far more to Washington than we get back — unlike many so-called ‘low-tax’ states that depend heavily on federal largesse. A higher SALT cap isn’t a luxury. It’s a matter of fairness. We reject this offer,” the four lawmakers continued.

New Jersey’s Tom Kean and Young Kim of California — have also threatened to reject any tax cut extension package that does not raise the SALT cap sufficiently. 

In a post on X, Kim, who co-chairs the House SALT Caucus with Garbarino, slammed the Republican leaders of both the chamber and the committee for waiting “until the eleventh hour to leak a number that they know does not provide the relief our constituents desperately need.”

“This isn’t an offer — it’s a slap in the face to the hardworking taxpayers we represent and stands in the way of progress on our House Republicans’ larger agenda,” she continued, warning that her colleagues “should be more worried about getting to 218 votes on the floor for the tax cut vote.”

For his part, Johnson told reporters he’d “heard” the $30,000 figure, but quickly added that he’d “heard others as well.”

“It’s still an ongoing discussion amongst the members, and I think we’ll find the right point,” Johnson added. 

“I’m not going to handicap it because I’m not sure exactly what that is, but there’s a lot of analysis that’s going into it,” he said.

Unfamiliar with the SALT deduction?

Then you might not be among the 10% to 15% of tax filers who itemize their federal returns — mainly high income earners — rather than take a standard deduction.

Historically, the benefits of the deduction have mainly flowed to households making more than $200,000 a year, and mostly to those located in blue states like California, Connecticut, Maryland, New Jersey and New York.

In 2017, Trump and congressional Republicans capped the SALT deduction for the first time in history to offset some of the revenue they knew they’d be losing, leading to the current dissension among some members.

Members are now looking for a compromise that would both allow taxpayers to deduct some portion of their state and local taxes from their federal income tax, while in some way limiting the size of that deduction.

As for Trump, while he was once for the $10,000 cap, he now says he supports raising it, a sign perhaps that he’s banking on DOGE savings or is already looking toward the 2026 midterm elections where a win for Republicans like Lawler and Stefanik in high-tax districts could help solidify the GOP’s hold on the House.

Dan can be reached at [email protected] and @DanMcCue