Upper house

New $ 1.75 million spending plan would lift $ 10,000 SALT cap for 5 years

A new iteration of President Joe Biden’s $ 1.75 trillion spending plan would include a temporary reprieve for the $ 10,000 limit on state and local property tax deductions, according to multiple media outlets.

The $ 10,000 SALT cap was passed as part of Republican-backed federal tax cuts in 2017, and heavily criticized by Democrats in high-tax states like New York and New Jersey, who said the limit was designed to target them specifically.

Under the deal proposed by Congress, the $ 10,000 limit would be lifted until 2025, according to The hill and Advanced NJ Media.

“The SALT deduction cap remains a blow to our home states of New York and New Jersey as we strive to recover from the pandemic and put our savings back on solid footing and put our constituents back on track. work, ”reads a joint statement released on Tuesday. US Representatives from New Jersey Josh Gottheimer and Mikie Sherrill, both Democrats, and US Representative Tom Suozzi, also Democrat, from New York.

“Today’s news is encouraging for the inclusion of a repeal of the SALT cap in the final reconciliation package,” the statement continued.

The news was pissed off by U.S. Senator Bernie Sanders, an independent member and one of the most progressive members of the upper house of Congress, who rejected Governor Phil Murphy’s campaign for re-election in New Brunswick last week.

Campaign of US Senator Bernie Sanders and Governor Phil Murphy at Rutgers University-New Brunswick on October 28, 2021. – PHIL MURPHY CAMPAIGN

“It is beyond the unacceptable” Sanders tweeted Tuesday afternoon. “In an age of massive income and wealth inequality, the last thing we should do is give more tax breaks to the very rich. “

Murphy, who also hosted Biden in New Jersey last week to promote the president’s proposed infrastructure package, said any spending bill absolutely must include a repeal of the SALT cap.

“I look forward to working with our Congressional delegation to ensure that the final bill also includes relief from the SALT deduction cap,” the governor said in a statement last week, essentially going against of Sanders, who approved it.

An April letter from Murphy and six other Democratic governors estimated the cap had cost New Jersey residents an additional $ 3 billion in annual taxes. A law the governor signed last year aims to soften the blow from the $ 10,000 cap by shifting the timing of many businesses filing taxes.

“The SALT deduction cap was the biggest tax hike for middle-class families in our state’s history, and I won’t stop fighting until New Jersey gets the relief that we deserve, ”Murphy said.

The spending proposal includes hundreds of billions of dollars each for climate change and clean energy initiatives, expanding child care and early childhood education, and other key items to l social safety net agenda.

The lean version of the bill was intended to garner support from West Virginia Senator Joe Manchin, arguably the most conservative Democrat in the upper house.

With the party only having 50 seats, it needs every vote to move the bill forward. Democrats hope to tie the spending bill to a vote on the $ 1,000 billion infrastructure package, which could include funding for the long-blocked Hudson River replacement tunnels.

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