House Speaker Mike Johnson is being pressured on multiple fronts in his efforts to pass a budget reconciliation bill by Independence Day.
Not only is he being pressed by fiscal hawks to make deep spending cuts to cover tax breaks, but he’s also being threatened by blue-state Republicans demanding higher tax deductions to offset their states’ high-tax policies.
On Thursday, four Republican House lawmakers from New York stated that they would not vote for a budget bill that puts a $30,000 cap on state and local income tax (SALT) deductions.
That’s bad news for House GOP leaders, who are fighting tooth and nail to pass a bill that would extend President Donald Trump’s 2017 tax cuts before their expiration as well as fund border security and the military.
“With no notice or agreement, the Speaker … proposed a flat $30,000 SALT cap—an amount they already knew would fall short of earning our support,” reads the statement, signed by Rep. Elise Stefanik, a chairwoman of GOP House leadership.
It was also signed by New York Republican Reps. Andrew Garbarino, Nick LaLota and Mike Lawler.
A SALT deduction allows residents in high-tax states to deduct their state and local taxes on their federal tax returns.
Under Trump’s first-term 2017 tax cuts—which are set to expire at the end of the year—taxpayers can deduct up to $10,000 on their returns under SALT.
Now, blue state Republicans and moderate Democrats are pushing for a higher cap, although they haven’t united publicly on a dollar figure. Lawler, however, introduced a bill in January that would raise the cap to “$100,000 for single filers and $200,000 for married couples filing jointly.”
The four Republican lawmakers’ statement goes so far as to warn: “It’s not just insulting, it risks derailing President Trump’s One Big Beautiful Bill.”
It continues: “New Yorkers already send far more to Washington than we get back—unlike so many so-called ‘low-tax’ states that depend heavily on federal largesse … We reject this offer.”
The statement complicates an already difficult situation for Johnson and House GOP leadership, given that they are also facing pressure from fiscal hawks who demand deep spending cuts to offset tax cuts.
Rep. Chip Roy, R-Texas, for example, is demanding $1.4 trillion in 10-year spending cuts to pay for Republicans’ tax-cut goals.
The Republican SALT faction has found a Democrat supporter in New York Rep. Tom Suozzi, whose Long Island district voted for Trump in 2024. Suozzi sits on the House Ways and Means Committee.
“Let’s commend our five colleagues that are standing against their party to say they want to raise the [SALT] deduction … Let’s be fair to make sure that these states that are net donors to the federal government are treated with the proper respect and dignity that they deserve,” said Suozzi in a floor speech this week.
But not every SALT deduction advocate is opposed to leadership’s $30,000 cap offer.
Rep. Nicole Malliotakis, R-N.Y., said in a statement Friday that “tripling the deduction to $30,000 will provide much-needed relief for the middle-class and cover 98% of the families in my district.”
