In the HEROES pandemic stimulus bill they passed in May, House Democrats included a two-year waiver of the cap on federal income-tax deductions for state and local taxes that was imposed by the 2017 tax-cut law. That idea was dead on arrival with Senate Republicans, who see the SALT deduction as an unworthy subsidy that rewards “high-tax/high-spend” blue-state politicians, and it’s become a red plank in their political narrative.
Not every defense of the SALT cap is coming from the right, though. In a Brookings Institution blog post and a subsequent New York Times op-ed, Richard V. Reeves and Christopher Pulliam called removing the cap a massive handout for the rich and advocated eliminating the deduction altogether. Democrats have not been persuaded: Senate Minority Leader Chuck Schumer and other top Democrats say SALT reform will be a top priority if their party regains control of the upper house.