New York lawmakers are applying pressure on President Joe Biden and congressional leaders, looking to eliminate a cap on the federal tax deduction of state and local taxes, known as SALT.
Rep. Tom Suozzi, a Democrat who represents Queens and Long Island, is pushing for a repeal of that cap to be included in Biden’s infrastructure plan.
“The bottom line is: No SALT, no deal,” he said.
What You Need To Know
- Rep. Tom Suozzi, a Democrat representing Queens and Long Island, is pushing for a repeal of the SALT cap to be included in Biden’s infrastructure plan
- A $10,000 cap was put in place during the Trump administration
- Speaker Nancy Pelosi has said she is “sympathetic” to those looking to ease the cap, saying “hopefully” they can get changes included in the bill
Suozzi’s threat has gotten some notice in recent days. With slim Democratic majorities on Capitol Hill, if Suozzi and a few of his fellow Democrats stick together in objecting to any plan that does not include the repeal, they could put Biden’s next big legislative push in peril — especially if Republicans refuse to go along with the infrastructure proposal.
“Now we’re starting to see people pay attention. And that’s what we wanted to see happen. And we’re going to get something done,” he said.
The $10,000 cap on SALT was put in place during the Trump administration as part of the Republicans’ massive tax overhaul.
Democrats and some Republicans in states with high taxes like New York and New Jersey objected, likening it to a gut punch for homeowners who pay high local property taxes.
The deduction has faced criticism as being a benefit for the wealthy. The Joint Committee on Taxation projected that in 2017, well over half of the benefits from the SALT deduction went to taxpayers making more than $200,000 a year.
Suozzi argues those numbers need to be put in context, saying, “$150,000 a year in New York doesn’t make you a wealthy person. That’s hard-working middle-class families. And they have been very hard hit by the cap on the SALT deduction.”
The congressman said he has a meeting tentatively planned with the White House.
Negotiations over Biden’s infrastructure proposal are in the earliest stages, and the White House press secretary has suggested that all sorts of tax ideas will be part of discussions.
Suozzi is by no means alone in wanting the cap removed. Many other New Yorkers have also called to eliminate it — though they have not drawn the same red line when it comes to the infrastructure package.
“I fully favor the restoration of SALT’s deductibility,” Rep. Ritchie Torres, a Democrat representing the Bronx, said in an interview Tuesday. But, he noted, it is not his top priority when it comes to changes to the tax code.
Gov. Andrew Cuomo recently joined with other governors in sending a letter to the White House, urging Biden to undo the cap.
On Capitol Hill, Speaker Nancy Pelosi called the cap “politically targeted” and said she was “sympathetic” to those looking to ease it, saying “hopefully” they can get changes into the infrastructure bill.
At an event in New York recently, Senate Majority Leader Charles Schumer said he would do everything he can to get the cap repealed, calling it a “dagger aimed at the heart of New York.” Schumer has, like Suozzi, introduced legislation eliminating the cap.
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