A group of Republican congressmen in blue states said they will oppose the Republican budget bill unless they get the deal they want on deducting state and local taxes (SALT).
“It is a hill I am willing to stake my entire congressional career on,” Rep. Nick LaLota, R-N.Y., told Punchbowl News.
Rep. Mike Lawler, R-N.Y., one of the few Republicans in Congress who represents a district then-presidential candidate Kamala Harris won in 2024, said if there is not a fix to SALT, there will be no bill.
SALT allows individuals or married couples to subtract the amount they paid in state taxes from their federal tax bill, but SALT deductions have been capped at $10,000 since the Trump administration tax cuts were passed in 2017, The Washington Post reported.
“If nothing passes, SALT comes back unlimited, so it is on leadership to offer a number and negotiate from there,” Lawler said. We are not negotiating against ourselves.”
A cap on SALT will disappear in 2026 unless Congress passes legislation, which is what Republicans like Lawler and LaLota are aiming for, Punchbowl said, lessening their incentive to make a deal.
The other members of the SALT crew are Rep. Andrew Garbarino, R-N.Y.; Rep. Tom Kean, R-N.J.; and Young Kim, R-Calif.
Rep. Jason Smith, R-Mo., the chair of the Ways and Means Committee, and House Speaker Mike Johnson, R-La., have been meeting with SALT supporters to try to work out a deal that provides tax relief but doesn’t lose conservative votes, Punchbowl reported.
Several Republicans have argued they should let the budget reconciliation process collapse and make a deal with Democrats later this year. The bill would likely keep tax cuts in place, avoid politically perilous spending cuts, and restore the full deduction of state and local taxes, according to Punchbowl. It would likely face opposition from the majority of the House Republican Conference.
Talks between Smith and the SALT Republicans remain stalled, Punchbowl said, with the SALT Republicans acutely aware of their leverage.
House Republican leadership believes the longer the SALT crew holds out, the easier it will be to split them, hoping pressure from their colleagues and President Donald Trump will help fracture the caucus, Punchbowl said.
“The taxpayers of Tennessee shouldn’t have to bail out somebody in New York because of their bad decisions. They’ve got terrible tax laws up there,” Rep. Tim Burchett, R-Tenn., said to the Post.
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