MW 'Dead on arrival:' GOP war over SALT cap breaks out, threatening Trump tax bill

By Chris Matthews

Senate Republicans want to maintain a $10,000 cap on state and local tax deductions

A fresh Republican rift over taxes burst into public view Monday, as New York House Republicans slammed Senate GOP leaders for reportedly backing a plan to preserve the $10,000 cap on state and local tax deductions - a move that could sink President Donald Trump's signature tax bill before it even hits the Senate floor.

Punchbowl News reported Monday that the Senate Finance Committee will introduce a $10,000 cap in its legislative text later Monday as an opening "negotiating mark."

But some House Republicans don't appreciate the gambit.

"Dead on arrival," New York Republican Rep. Mike Lawler posted on X Monday, in response the news that the Senate Finance Committee plans to strip out the SALT relief passed by the House of Representatives in its version of the bill last month.

Lawler said in a subsequent statement that he will "not accept a penny less" than the $40,000 cap for families making less than $500,000 annually that was negotiated in May. "If the Senate reduces the SALT number, I will vote No and the bill will fail in the House," he added.

Lawler's fellow New York Republican Rep. Nick LaLota was equally blunt in an X post, saying "the Senate doesn't have the votes for a $10k SALT in the House," and noting that the SALT cap would become "unlimited" if the Trump tax cuts are allowed to expire at the end of the year.

The House-passed bill reflects the fact that the three-vote Republican majority in the lower chamber relies on the votes of members from high-tax jurisdictions, including New York and California, whose constituents were hurt by the $10,000 cap placed on SALT deductions through the tax-reform package signed into law by President Trump in 2017.

Senate Republicans, however, largely hail from lower-tax states and view the deduction as a giveaway to wealthy blue-state residents and as a budget buster than they can't justify.

"There's not a single senator who is impacted by SALT," said Senate Majority Whip John Barrasso, a Wyoming Republican, last month. "That's an area where we understand their situation, but we don't have that same pressure or problem. We have other issues with other members that we've got to focus on."

The dynamic is now crashing into a hard political reality, as Republicans like Lawler and LaLota represent suburban swing districts where high property taxes and a slim house majority have made SALT a defining issue.

If Senate Republicans kill SALT relief, they risk losing votes they need to pass the broader tax-and-spending package, which includes an extension of Trump's individual tax cuts, new spending on border enforcement and new tax breaks for tipped workers and seniors that the president campaigned on.

Raising the SALT cap is expensive, however, with Senate Finance Chairman Mike Crapo, an Idaho Republican, estimating it would cost about $350 billion over 10 years. Senate Republicans would rather use that money to make permanent business deductions like the full expensing of research and development and investments in property and heavy equipment.

The fight over SALT isn't new. When the 2017 tax reform was originally passed, 12 House Republicans voted against it in part because of the SALT cap. But the GOP has a much smaller majority this time around.

The risk now is that the SALT impasse could delay or derail the tax package. So far, many lawmakers remain optimistic the legislation will get over the finish line.

"Everyone knows this 10K number will have to go up," New York Republican Rep. Elise Stefanik said on X Monday. "And it will."

-Chris Matthews

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June 16, 2025 14:41 ET (18:41 GMT)

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