The House is trying to pass its budget bill, and state and local tax, or SALT, deductions are an issue on which New York House Republicans have been unable to budge, while others insist President Donald Trump’s agenda must pass anyway.
“Raising the SALT deduction is a bailout for Democrat Governors—paid for by red states with low taxes. Tennesseans should not foot the bill for New York and California’s mismanagement,” Rep. John Rose (R-TN) argued.
Rep. Nick LaLota (R-NY) fired back at the post, retorting that New York receives less proportionally from the federal government than Tennessee. “For every dollar NY sends to DC, we get 91 cents back,” he wrote. “For every dollar TN sends to DC, it gets $1.40 back. Yes, my state’s governor is a terrible manager of our state’s funds. Yet, it’s NY that is subsidizing TN, not the other way around.”
Trump tried swaying New York Republicans earlier on Tuesday, even calling Rep. Mike Lawler (R-NY) out in the GOP conference meeting, saying, “I know your district better than you do. If you lose because of SALT, you were going to lose anyway.”
Lawler and LaLota were unconvinced by Trump’s speech. Lawler said he’s still a “no” on the reconciliation bill, which calls for $1.5 trillion in spending cuts to offset extending Trump’s 2017 tax breaks.
“This is the single biggest issue that I’ve talked about, and while I respect the president, I’m not budging,” Lawler said coming out of the meeting.
Residents of states like New York and California benefit more from SALT tax deductions because of their high state taxes. Tennessee has no state individual income tax, so SALT would be less beneficial there.
TRUMP’S UNITY SPEECH DOESN’T SWAY SALT OR FREEDOM CAUCUS REPUBLICANS AT THE CAPITOL
With the price of the budget bill already projected to add trillions to the national debt, Republicans with little SALT interest are unlikely to make concessions on it. An analysis from the Congressional Budget Office projected the budget proposal would add some $3 trillion over the next decade to the national debt, which already stands at $36 trillion.
“It should be D-O-A. We shouldn’t even be talking about this bill,” Sen. Ron Johnson (R-WI) told the Washington Examiner. “It’s so awful. It’s so far off the mark. It’s so inadequate. I’ve been trying to interject reality. I’ve been trying to interject facts and figures.”
