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yesterday

GOP Split Over SALT Cap Brings Reconciliation Bill to Standstill

Persistent discord over the SALT cap has halted progress on the tax-and-spending package with only days left before July 4.

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Overview

  • House GOP leaders and the SALT Caucus uphold a $40,000 cap on state and local tax deductions for filers earning up to $500,000.
  • Senate Republicans maintain the existing $10,000 limit and propose phasing out tip and overtime deductions alongside capping pass-through entity taxes.
  • Key SALT Caucus members from high-tax states have pledged to vote down any bill that alters the negotiated $40,000 threshold.
  • The White House has set a July 4 deadline for the package, and failure to agree could expire the SALT cap and revert deductions to an unlimited level.
  • The stalemate imperils President Trump’s flagship tax-and-spending bill as Republican moderates warn they will sink the legislation if their demands are not met.