As Donald Trump is preparing for the start of his second term as president a week from today, a delegation of Republican lawmakers from New York met with him over the weekend at Mar-a-Lago, seeking some federal government muscle to back their local priorities. Chief among these is the repeal of the cap on SALT (state and local tax) deductions.
Rep. Nicole Malliotakis from Staten Island, who was part of the weekend meeting with the president-elect, said that he backs their efforts on both fronts, and accuses local officials of contributing to the problem. “The mayor and the governor are the ones where this burden is placed. They should respect taxpayers more, not treat them like ATMs,” Malliotakis told NY1 this morning. “But we’re trying right now to find a federal solution, working with president[-elect] Trump, to see how we could provide relief from the federal level.”
In 2017, the first Trump administration passed the Tax Cuts and Jobs Act, which capped SALT deductions from federal taxes for the first time at $10,000 from 2018 to 2025. The move has faced its fair share of criticism since it was introduced, as households in high-income and high-tax blue states like Connecticut, New York, and California faced the sharpest increases in their tax bill due to the restrictions. With the cap set to expire at the end of this year, Republicans and Democrats from those states are now fighting to have it changed, especially a provision that has been described as a “marriage penalty,” as the cap for married couples filing jointly is the same as for people filing single (married couples filing separately split the cap at $5,000 each).
Some are arguing for a full-on repeal, while others are seeking a compromise on the measure currently in place. “We want to tailor this,” Malliotakis told NY1. “We’re not looking to give a break to the very wealthy. What we’re trying to do is help middle-class families.” Another New York Republican Congressman who went to Mar-a-Lago over the weekend, Mike Lawler, echoed the idea of change rather than repeal when speaking to the press after the meeting, saying that they discussed “the need to come up with a number and work through it and build consensus in the House.” Democratic New York Governor, Kathy Hochul, has been a vocal opponent of the SALT cap and called out Lawler on social media. “New Yorkers deserve a full repeal of the SALT cap. Anything less is a failure—and you know it, Mike,” Hochul wrote on X (formerly Twitter).
Raising the SALT cap (or by extension, repealing it) does not appear have the broad-based effect Malliotakis and Lawler say they are seeking. Analysis from Howard Gleckman of the nonpartisan Tax Policy Center finds that if the cap were raised to $20,000, eliminating the marriage penalty, over 99% of households making less than $200,000 would get no tax cut whatsoever, with 0.6% only getting $470 on average. In households that earn between $430,000 and $1 million (top 95% to 99% of households), the cut would average at $1,300, with over half of that group seeing a decline of $2,300. “There are a nearly infinite number of ways to raise the SALT cap,” Gleckman wrote in Forbes last week, citing measures like limiting the benefits to households earning less than $200,000 and getting more vigilant about business write-offs. “But almost all being seriously considered by Congress would largely benefit upper middle-income households.”
