House Republicans’ proposal to triple the SALT deduction cap to $30,000 exposes a growing rift within the party as New York Republicans threaten to torpedo the tax legislation unless their high-tax state constituents receive even greater relief.
Key Takeaways
- House Republicans propose increasing the State and Local Tax (SALT) deduction cap from $10,000 to $30,000 for taxpayers earning under $400,000
- The proposal primarily benefits residents of blue states with high state income taxes while remaining controversial among fiscal conservatives
- Some New York Republicans are demanding even higher caps, threatening to vote against the tax package unless their demands are met
- House Speaker Mike Johnson acknowledges the final cap amount is still being negotiated as the proposal faces scrutiny
- The measure is part of a broader tax reconciliation bill leaders hope to pass before Memorial Day
Republican Tax Relief Proposal Creates Internal Division
House Republicans have proposed raising the State and Local Tax (SALT) deduction cap from $10,000 to $30,000 for taxpayers earning less than $400,000 annually. The provision, released by the House Ways and Means Committee, aims to placate Republican lawmakers from high-tax states like New York and California who have long argued that the cap unfairly penalizes their constituents. However, the plan has ignited fierce debate within the party, with fiscal conservatives viewing it as effectively subsidizing high-tax blue state policies while moderates from those states insist the relief doesn’t go far enough.
House Speaker Mike Johnson has indicated that negotiations continue on the final figure. “There’s no set number yet. That’s the whole thing. This is still being resolved,” said House Speaker Mike Johnson, R-La.
New York Republicans Push Back, Demand Higher Cap
Several New York Republicans have already signaled their opposition to the proposal, demanding significantly higher SALT deduction limits. Representatives from the Empire State are pushing for caps as high as $62,000 for single filers and $124,000 for married couples filing jointly, arguing these figures better reflect the financial realities of their high-cost districts. The group, including Representatives Elise Stefanik, Andrew Garbarino, Nick LaLota, and Mike Lawler, released a statement emphasizing the tax burden their constituents already face.
“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,” said New York Republican Reps. Elise Stefanik, Andrew Garbarino, Nick LaLota, and Mike Lawler.
When asked about his position on the new $30,000 cap proposal, Representative LaLota was unequivocal in his response: “Still a hell no.” With Republicans holding only a slim majority in the House, just a handful of defections could derail the entire tax package, putting immense pressure on leadership to find a compromise that can secure enough votes for passage while balancing fiscal responsibility concerns.
The Broader Political and Economic Context
The SALT deduction cap was originally implemented as part of President Trump’s 2017 Tax Cuts and Jobs Act, limiting the amount of state and local taxes that could be deducted from federal tax returns to $10,000. This particularly affected taxpayers in high-tax states like New York, New Jersey, California, and Illinois – predominantly Democrat-controlled states. The current proposal to raise the cap represents a delicate balancing act for Republicans, attempting to provide relief to their members from these states while avoiding accusations of abandoning fiscal conservatism.
Reminder that Elisa Stefanik voted against the 2017 tax cuts over SALT changes.
And she hasn’t exactly been given reason to be a team player since then… https://t.co/4vM0V2K62y
— Gabe Fleisher (@WakeUp2Politics) May 8, 2025
The debate over the SALT deduction cap is taking place within the context of broader budget reconciliation discussions, including potential Medicaid cuts and other fiscal measures. House Republican leaders are pushing to complete work on the tax package before Memorial Day, adding urgency to the ongoing negotiations. The Ways and Means Committee has scheduled markup sessions to finalize the proposal before it advances to a floor vote, where its fate remains uncertain given the internal party divisions.
