House bill calls for bigger SALT tax breaks

The House tax committee is looking to raise the cap on the state and local tax deduction (SALT) and formally adopt several of President Trump’s campaign tax promises as part of a multi-trillion-dollar package, Republicans’ main legislative priority.

The draft legislation, introduced by the tax-writing Ways and Means Committee in the House of Representatives on Monday, was released ahead of a scheduled debate on Tuesday, signaling that the Republican-led chamber is preparing for a full vote on the bill later this month.

Dubbed by Trump as “one big, beautiful bill,” the package would lock in tax cuts from his first term that are set to expire at the end of 2025, adding trillions to the national debt, per Reuters.

To help offset the lost revenue, the plan includes new limits on Medicaid, which serves 71 million low-income Americans, and other spending cuts totaling $912 billion over the next ten years.

NBC reported that House Speaker Mike Johnson, R-La., held a video call Monday morning with members of the Ways and Means Committee and the SALT Caucus—a group of blue-state Republicans pushing for a higher SALT cap than the current $10,000. The call ended without an agreement on a final number.

The bill would raise the nation’s borrowing limit by $4 trillion, smaller than the Senate’s preferred $5 trillion level. And with a slim Republican majority in the House, the president will need almost complete backing from his party for the bill to pass.

The legislation aims to slash taxes by over $4 trillion and cut federal spending by at least $1.5 trillion over the next ten years. The SALT provision would raise the cap to $30,000 for those with a modified adjusted gross income of $400,000 or less, up from the current $10,000 limit.

Changes to SALT — even by lifting the cap to $15,000 for single people and $30,000 for married couples — would result in lost revenue of $530 billion over 10 years, the Committee for a Responsible Federal Budget (CRBB) estimates.

Trump’s 2017 tax law capped the SALT deduction at $10,000, which he has vowed to eliminate since taking office for his second term. A workaround has allowed certain business owners in over 30 states—including California, New York, New Jersey and Connecticut—to fully deduct SALT, saving billions, while regular taxpayers remain subject to the cap.

The current cap has a direct impact on homeowners, particularly in high-tax states like Connecticut and California. Raising the cap could make buying a home in those areas more appealing, potentially boosting property values and increasing buyer confidence.

Despite internal GOP discussions about raising taxes on millionaires, the plan does not include any tax increases for the wealthiest Americans. Instead, it would lock in the current top individual income tax rate of 37%, established under Trump’s 2017 tax law—even though Trump recently told Speaker Johnson he wanted a higher 39.6% rate for those earning more than $2.5 million, Bloomberg reported.

Speaker Johnson has said he wants the House to pass the bill before Memorial Day. Lawmakers, however, face a more urgent deadline in mid-July, as Treasury Secretary Scott Bessent has warned that the debt ceiling must be raised by then to prevent a default that could disrupt global financial markets.