The countdown is on for the end of the SALT cap.
In 2017, then-President Donald Trump and Republican lawmakers included a $10,000 cap on federal deductions for state and local tax payments in tax reform legislation to help pay for the tax cuts included in the bill.
But next year, several of those tax cuts, along with the SALT cap, are set to expire, and Washington is bracing for a fight over the future direction of the tax code — a debate that’s already underway in some quarters on Capitol Hill.
Sen. Chuck Schumer told reporters last month that the cap “will expire” next year as long as he is Senate Majority Leader.
“I’m not going to introduce a bill in Congress that would reinstate it, because it would be very damaging to New York,” he said.
But if Democrats lose control of the Senate in November, the effort to block a new SALT cap could move to the U.S. House of Representatives, where Rep. Hakeem Jeffries of Brooklyn is expected to become speaker if Democrats win enough seats.
So what will Jeffries do? On Thursday, he said Democrats are “committed to repairing the damage caused by radical MAGA Republicans in connection with the 2017 GOP tax fraud.”
He then appealed to voters, arguing that Democrats should be given the power to handle SALT’s future.
“On Jan. 3, voters in the 119th Congress will decide whether the state and local tax deduction is restored in full or whether it will remain capped in a way that hurts middle-class families,” he said.
The SALT cap disproportionately hits taxpayers in Democratic-leaning states like New York, which have relatively high property and state income taxes. Removing the cap is a priority for both New York Democrats and Republicans.
Spectrum News asked lawmakers in the battleground state of New York whether they would vote in favor of a SALT cap if it were included in next year’s tax bill, and some drew clearer lines than others.
“They’re going to have to figure out how to live without it, because lawmakers like us are never going to vote to extend the cap,” said Republican Rep. Marc Molinaro.
“We absolutely must repeal this SALT cap,” said Rep. Pat Ryan, a Hudson Valley Democrat. “We have to start with not taxing people twice.”
“I would vote depending on whether I get a full refund of state and local tax deductions or something that addresses the needs of most people in my district,” said Rep. Tom Suozzi, D-Nassau County.
“We need to negotiate to raise the SALT limit,” said Rep. Nick LaRota, a Suffolk County Republican who said the $10,000 cap “is not enough” for his constituents.
Ultimately, the influence these New Yorkers have in tax policy negotiations may depend on the makeup of next year’s Legislature.
“Nobody is going to have a majority on January 3, 2025,” Republican Rep. Mike Lawler argued. “Everybody has to acknowledge that, and we need our votes.”
This week, President Trump reversed course on SALT: After helping to enact the SALT cap seven years ago, President Trump now says he wants “SALT back.”
