The United States House of Representatives passed President Trump's spending bill Wednesday night, sending it along to the Senate. In it is a quadrupling of the cap on the State and Local Tax deduction, known colloquially as the SALT deduction, which Representative Nick LaLota said in a press release early Thursday is "a significant win for Long Island taxpayers."
Mr. LaLota, who handily won re-election in November, is a member of the House's SALT Caucus, which started pushing for the increase to the SALT deduction in January 2023.
"The deal raises the SALT deduction cap to $40,000 for households earning under $500,000, with both thresholds indexed to grow by about 1 percent annually - reaching roughly $44,000 and $552,000 by year 10. A household earning $333,000 and paying $20,000 in property taxes would now be fully covered under the tax cap," his office said.
"This was a years-long battle, and I'm proud my colleagues finally came around to a plan that fixes the unfair $10,000 cap from 2017," he said in the release. "Raising it to $40,000 means 92 percent of the families I represent will finally be made whole. For too long, Suffolk County's middle class has been punished by double taxation. That ends now."
According to the New York State Comptroller, the median household income in Suffolk County is $128,300.
A May 20 "preliminary analysis of the distributional effects of the One Big Beautiful Bill Act" released by the nonpartisan Congressional Budget Office said that if the legislation is enacted, "The changes would not be evenly distributed among households. The agency estimates that in general, resources would decrease for households in the lowest decile (10th) of the income distribution, whereas resources would increase for households in the highest decile."
The C.B.O. also estimates that between 2026 and 2034, the legislation will increase the federal deficit by $3.8 trillion and reduce, by $698 billion and $267 billion, federal subsidies for Medicaid and SNAP, respectively. SNAP, or the Supplemental Nutrition Assistance Program, provides food assistance to low-income families.
The bill extends the 2017 tax act. "Resources would increase by an amount equal to 4 percent for households in the highest decile in 2027 and 2 percent in 2033, mainly because of reductions in the taxes they owe," reads the C.B.O. analysis.
"Securing this deal took months of pressure, standing firm, and refusing to settle," Mr. LaLota added in his press release. "I meant what I said: No SALT, no deal for real. That wasn't a slogan, it was a promise to Suffolk County families. And today, we delivered."
According to the Tax Foundation, which describes itself as "the world's leading nonpartisan tax policy" nonprofit, with the deduction set at $10,000, just over 16 percent of taxpayers in Congressional District 1 claimed the deduction. Mr. LaLota said this was evidence of just how narrow and inequitable the benefit has been.
