Senate Republicans are showing little indication they’re willing to make former President Donald Trump’s campaign promise to repeal his own limit on state and local tax deductions a reality.
Known simply as SALT, the tax deductions are typically cheered by blue-state lawmakers with higher tax burdens but derided by Republicans as a giveaway for coastal wealthy elites.
“We’ll take his ideas into consideration when the time comes,” Senate Minority Whip John Thune (R-SD), who’s running to be the next GOP leader, told the Washington Examiner. “There’ll be a lot of certain pushback from some of our members who think that subsidizing the high-tax states isn’t a good idea.”
Trump’s 2017 tax law capped the amount of state and local taxes that can be claimed on federal deductions to $10,000 per filer, which was previously unlimited. But in a vague pledge on Truth Social ahead of a Wednesday night rally on Long Island, Trump said he would “get SALT back, lower your Taxes, and so much more.”
The vow was seen by some as currying favor to high-taxed voters in the Empire State, where Republicans have sought to chip away at Democrats’ blue wall.
“Lifting the SALT cap is basically a gift to high-income individuals in Democrat states,” said Sen. Mitt Romney (R-UT), who’s retiring from Congress in January. “As you get closer to the election, and as close as it is, people are grasping for ways to get a few extra votes.”
The debate over SALT is one of several tax cut proposals Trump has floated in his bid to retake the White House that has put him at odds with GOP deficit hawks who say Congress needs to get serious about the national debt. Trump’s other revenue-reducing plans include no taxes on tips and Social Security benefits, which he’s countered would drive economic growth and thus not increase the debt.
Senate Majority Leader Chuck Schumer (D-NY), a leading proponent of raising the cap, accused Trump of having “selective amnesia.”
“For Donald Trump to pretend he’s found religion on eliminating the SALT caps — two months before an election, speaking in Long Island — is comical, it’s unserious, and it shows the lack of integrity that this man has,” Schumer said. “His promises carry about as much weight as Monopoly money.”
If Congress takes no action by the end of 2025, those like Trump and Schumer will get their way. The SALT cap is set to expire in 2026, at which point the Joint Committee on Taxation estimates it will cost the federal government nearly $140 billion annually in lost revenue from federal deductions. The current limit reduces revenues by about $21 billion per year.
SALT deductions typically aid higher-income people the most, who have enough tax liability to benefit and itemize their deductions. The nonpartisan Tax Foundation estimated that prior to the $10,000 cap, 91% of the filers who benefited made over $100,000, fueling fears among opponents of an unlimited deduction that it would raise state and local taxes.
Sen. Mike Crapo (R-ID), the top Republican on the Senate Finance Committee, said, “Nothing is off the table.” But his personal preference on the SALT cap was to “extend them as they are.”
Some Republicans suggested Trump’s newfound SALT stance was part of a broader forward-looking negotiating position with Democrats to extend other Trump-era tax cuts, many of which are set to expire after 2025. Sen. Roger Marshall (R-KS), who expressed that viewpoint, ultimately preferred to “just leave it the way it is.”
Sen. Rick Scott (R-FL), another GOP leader candidate who’s also up for reelection, articulated the thinking among many opposed to Trump’s position: “Having the federal government subsidize local taxes seems out of sense.”
SALT creates strange bedfellows, joining together members from both parties in high-tax states like California and New York. The cap is $10,000 whether filing single or married, dubbed the “marriage penalty” by those in favor of SALT deductions.
Reps. Marc Molinaro (R-NY) and Anthony D’Esposito (R-NY), both of whom represent Biden-won swing districts, are major proponents for undoing the limit. House Republican Conference Chairwoman Elise Stefanik (R-NY) is as well.
“President Trump has watched New York Republicans advocate to make life more affordable for our neighbors,” D’Esposito said. “SALT is a priority — one I will keep fighting for and look forward to restoring the deduction in the 119th Congress with President Trump in the White House.”
House Democrats, who are also proponents of nixing the SALT limit, dared Trump to put his money where his mouth is.
“He’s the one who created this devastating issue in the first place that has hurt so many of my constituents so badly,” Rep. Tom Suozzi (D-NY) said. “And if it’s not just a political ploy and he’s serious, he should get 100 members of the House of Representatives that are Republicans and 25 members of the Senate that are Republicans to sign up right now, to do it right now instead of waiting.”
Democratic Caucus Chairman Pete Aguilar (D-CA) told the Washington Examiner that Democrats will be ready to pass “reasonable tax policy” if they gain control of the House, foreshadowing an effort to raise the cap.
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“This is a problem that they created, and unfortunately, now [Trump] wants to put out a couple tweets and act like he can pass policy to unwind the damage that he’s done to working families,” Aguilar said.
Rep. Pat Ryan (D-NY) offered a blunter analysis. He assailed Trump’s new SALT stance as “another piece of bulls*** on top of a pile of bulls***.”
Cami Mondeaux contributed to this report.
