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Speaker Johnson reaches tentative deal with blue state Republicans to boost cap on ‘SALT’ deduction
News

Speaker Johnson reaches tentative deal with blue state Republicans to boost cap on ‘SALT’ deduction

Jimmie Dempsey
Last updated: May 21, 2025 5:06 am
Jimmie Dempsey Published May 21, 2025
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House Speaker Mike Johnson has reached a tentative deal with blue state Republican lawmakers to boost the cap on state and local tax deductions, or “SALT,” to $40,000 in President Donald Trump’s so-called “big, beautiful bill,” Republican sources confirmed to Fox News late Tuesday. 

The proposed cap – which is up from $30,000 – would be per household for taxpayers making less than $500,000 per year. 

GOP HOLDOUTS UNMOVED BY TRUMP’S ‘BIG, BEAUTIFUL’ TRIP TO CAPITOL HILL

 It remains unclear whether GOP hardliners who oppose raising the SALT cap deductions will sign off on the measure. 

The tentative agreement, first reported by Politico and confirmed by Fox News, comes as House GOP factions have been engaged in high-stakes debates on taxes, Medicaid, and green energy subsidies while crafting the president’s “big, beautiful bill.”

Donald Trump stands next to Mike Johnson

SALT deduction caps primarily benefit people living in high-cost-of-living areas like New York City, Los Angeles, and their surrounding areas. 

BLUE STATE REPUBLICANS THREATEN MUTINY OVER STATE AND LOCAL TAXES IN TRUMP’S ‘BIG, BEAUTIFUL BILL’

Mike Johnson speaks at press conference

Republicans representing those areas have framed raising the SALT deduction cap as an existential issue, arguing that a failure to address it could cost the GOP the House majority in the 2026 midterms. 

Meanwhile, Republicans representing lower-tax states are largely wary of raising the deduction cap, believing that it incentivizes blue states’ high-tax policies. 

Fox News Digital’s Elizabeth Elkind contributed to this report. 

Read the full article here

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