GOP divided over lifting SALT cap
Rep. Mike Lawler, R-NY, joins ‘Sunday Morning Futures’ to discuss Trump’s meeting with blue state Republicans on lifting the SALT cap and New York City congestion pricing.
President-elect Donald Trump is giving Republicans his blessing to negotiate a key tax that could prove critical to GOP negotiations for a massive overhaul of conservative politics next year.
Trump met with several different groups of House Republicans at Mar-a-Lago over the weekend, including blue state GOP lawmakers who make up the House SALT Caucus, a group that opposes the cap. need $10,000 in state and local tax (SALT) deductions that primarily affect urban and suburban residents in areas with high income and property taxes, such as New York, New Jersey, and California.
“I think it was productive and successful,” Rep. Nicole Malliotakis, R.N.Y., said of the meeting. “The president supports our efforts to increase the SALT deduction. “He understands that blue state mayors and governors are crushing taxpayers and wants to provide relief from the federal level.”
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President-elect Donald Trump told New York Republicans that he would work with them on a number of priorities. (Chip Somodevilla/Getty Photos)
But Trump also noted that he was aware of opposition from others in the House Republican conference, particularly Republicans in rural districts, who have seen SALT deductions as tax breaks for the wealthy. Before the cap was imposed in 2017, there was no limit on the amount of state income and property taxes people could deduct from their income when filing their federal returns.
“It gave us a small task to work on, a number that could provide our middle-class constituents with relief from the high taxes imposed by our governor and mayor, and at the same time, you know, something that could build consensus and reach a (a 218-vote majority),” Malliotakis said.
“I think we pretty much know that there will not be a complete lifting of the SALT limit. There is no desire within Congress, or even among American taxpayers, to cut taxes for the ultra-wealthy.
“Our efforts are really geared toward middle-class families, and that’s what we focus on to try to strike the right balance.”
Lawmakers in New York and California have opposed the current SALT deduction limit for much of its existence, since it was imposed in Trump’s Tax Cuts and Jobs Act (TCJA).
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Rep. Nicole Malliotakis told Fox Information Digital that Trump would work with New York Republicans on congestion pricing. (Drew Angerer/Getty Photos)
Trump suggested he would change course during his second administration in September last year, when he posted on Fact Social that he would “bring back SALT, cut your taxes and much more.”
The discussions are part of broader Republican conversations about passing a massive overhaul of fiscal and conservative policy through a process known as “reconciliation.”
By lowering the Senate threshold for approval to a simple majority instead of two-thirds, the process allows the party that controls both chambers of Congress and the White House to pass certain legislation as long as it addresses budgetary and other fiscal issues.
Some Republican supporters of the SALT deduction, such as Rep. Mike Lawler, R.N.Y., had signaled that they could withdraw support for the final bill if the limit was not raised.
“The only red line I have is that if there is a tax bill that doesn’t lift the SALT cap, I wouldn’t support it,” Lawler told Fox Information’s Sunday Morning Futures.
Lawler also said Trump agreed that it was necessary to increase the SALT deduction limits.
House Republicans have virtually no margin for error with a razor-thin majority from Trump’s inauguration until probably sometime in April.
Rep. Mike Lawler said the limits on SALT deductions were a “red line” for his support for a budget reconciliation bill. (Tierney L. Cruz)
Meanwhile, Trump also told New York Republicans he would help them fight the state’s controversial congestion pricing rule that imposes an extra cost for driving in parts of Manhattan.
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“He understands how unfair this is and how it would affect the city’s economy and the people we represent, so we are currently working with him on legal options to reverse the Biden administration’s rubber stamp,” Malliotakis said. “If there is a legal option, if there is a legal option for him to stop congestion pricing, he will do it.”
“There are, you know, police officers, firefighters, nurses, restaurant workers who have to come in at odd hours and drive because they don’t feel like the transit system is clean or safe.”
Congestion pricing went into effect in New York City earlier this month.
Fox Information Digital reached out to Trump’s transition team for comment on this weekend’s meeting.
