New York GOP moderates, leaders get SALT agreement after floor protest

New York Republican moderates and House GOP leaders reached an agreement to consider a bill addressing the state and local tax deduction (SALT) within the next week after a group of Empire State lawmakers threatened to block legislative action over the issue, two sources told The Hill.

Two sources in the room where negotiations went late into the night on Tuesday told The Hill that Republican moderates received a commitment from GOP leadership that the chamber will move on a SALT-related bill in the coming days.

The legislation they expect to come up would be a modified version of Rep. Milke Lawler’s SALT Marriage Penalty Elimination Act, which would increase the SALT deduction from $10,000 to $20,000 for a married couple filing a tax return jointly. 

The bill would come up under a closed rule, the sources said.

Spokespeople for Speaker Mike Johnson (R-La.) and Ways and Means Committee Chairman Jason Smith (R-Mo.) did not immediately confirm the details of the agreement.

The agreement comes as the House prepares to hold a vote on the tax bill — dubbed the Tax Relief for American Families and Workers Act — on Wednesday, which moderates have sharply criticized for not including an increase in the SALT deduction.

On Tuesday, four moderate New York Republicans voted against a procedural rule vote on unrelated bills as a warning shot to House GOP leaders in order to protest an increase of the SALT deduction — a top priority for many blue-state Republicans — not being included. They flipped their votes to allow the procedural measure to pass as they continued to negotiate solutions late into Tuesday night.

The agreement could make for much smoother sailing for the bipartisan tax bill that is scheduled for passage on Wednesday evening under a fast-track process that does not allow for amendments and requires two-thirds support for passage, requiring Democratic support.

The tax bill, dubbed the Tax Relief for American Families and Workers Act, would expand the child tax credit by increasing the maximum credit per child from $1,600 to $2,000 until the end of 2025, while also restoring business deductions for research development costs, interest payments and capital investments, among other provisions.

The bill advanced out of the House Ways and Means Committee earlier this month in a resounding 40-3 vote, with all Republicans voting in favor.

Moderate Republicans on Tuesday said the two options being discussed were amending the tax bill to include SALT provisions, or moving separate legislation to address their concerns.