Moderate Republicans from high-tax blue states are scheduled to meet with Speaker Mike Johnson (R-La.) on Tuesday, as the impasse over the state and local tax (SALT) deduction cap hardens.
News of the gathering comes shortly after Rep. Mike Lawler (R-N.Y.), one of the most vocal supporters of increasing the SALT deduction cap, said negotiations between the SALT Caucus and leadership had not been happening.
The House Ways and Means Committee, which has jurisdiction over taxes, included a $30,000 SALT deduction cap for individuals making less than $400,000 in its portion of the GOP’s mega bill — triple the current $10,000 cap — which those in the SALT Caucus rejected. The group is pushing for a higher cap: During a meeting on Monday with Johnson and Republicans on the House Ways and Means Committee, the group floated a $62,000 cap for single filers and $124,000 for joint filers — a large difference from the proposal in the text.
Asked about conversations on Tuesday, Johnson said the group was nearing an agreement.
“We’re still having discussions, dialogue this afternoon, working on it. And we’re very close, I think, to finally resolving it,” Johnson said.
Pressed on whether he would increase the proposed SALT deduction cap from its current $30,000 offer, the Speaker was coy.
“I’m not gonna give details of the ongoing discussion, but I’m talking to both corners of the conference to try to find the perfect balance, and I think we will,” he said.
The debate over the SALT deduction cap has risen as one of the most contentious hangups hindering the GOP’s bill full of President Trump’s legislative priorities, with centrist lawmakers from high-tax blue states — including New York, New Jersey and California — pushing to increase the deduction cap, and hardline conservatives pushing against such a move because of the ballooning deficit.
The House Ways and Means Committee began debating its part of the GOP’s “big, beautiful bill” on Tuesday. Rep. Jason Smith (R-Mo.), the chair of the panel, deferred to Johnson when asked about the status of negotiations over the SALT deduction cap.
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“So failure is not an option, there’s gonna be bumps along the road throughout this process, but we’re gonna get it done and we’re gonna get agreement,” he added. “And the Speaker is in the middle of all kinds of negotiations.”
Punchbowl News first reported on Tuesday's meeting.
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