Democratic Leaders Confirm Intention to Find 'Meaningful' Relief on SALT Cap

By:
Chris Gaetano
Published Date:
Sep 14, 2021
Rep. Richard Neal

Rep. Richard Neal (D-Mass.), chair of the House Ways and Means Committee, released a statement alongside Oversight Subcommittee Chairman Bill Pascrell, Jr. (D-N.J.), and Congressman Tom Suozzi (D-N.Y.) , both strong advocates of lifting or totally removing the $10,000 cap on state and local tax (SALT) deductions, saying the party is committed to finding meaningful relief on the matter. 

"President Biden’s historic Build Back Better plan is one of the most significant bills Congress has ever considered," said Neal. "Its makeup is complex and will be shaped and crafted continuously to get it right. So what we consider now is an important step in the process, but not the final step. With Speaker Pelosi, we continue to work among our colleagues and the Senate to undo the short-sighted capping of SALT by Republicans. We are committed to enacting a law that will include meaningful SALT relief that is so essential to our middle-class communities and we are working daily toward that goal."

The statement came out shortly after the release of the party's tax plan to support the White House's economic agenda with no mention of removing or, at the very least, raising the cap, which previously had been described as a hard requirement for legislators from New York, New Jersey and California for their support of the bill. 

Bloomberg reported that, as a compromise, lawmakers are currently debating temporarily repealing the cap for two years, though this remains far from certain. Should such a compromise be agreed to, it could take the form of language inserted directly into the bill, an amendment to the package or a separate bill altogether. Democratic leaders will need to balance between mollifying representatives who have made this issue their hill to die on, and ensuring that there is enough money to find the package, as restoring the full SALT deduction would cost the U.S. Treasury $88.7 billion in lost revenue for 2021 alone. 

Click here to see more of the latest news from the NYSSCPA.