President Donald Trump arrives for a House Republican meeting at the U.S. Capitol on May 20, 2025 in Washington, DC.
Tasos Katopodis | Getty Images News | Getty Images
President Donald Trump failed during a visit Tuesday to Capitol Hill to sway key House Republicans from blue states to drop opposition to a major tax bill, which they say does not go far enough in boosting so-called SALT deductions for their constituents, sources told CNBC.
Opposition to the bill from the “SALT Caucus” threatens to derail the tax legislation, which Trump and House Speaker Mike Johnson, R-La., hope to see passed before Memorial Day weekend.
The intra-party battle revolves around the question of the tax deduction allowed for state and local taxes on federal income tax returns.
A Republican tax bill in 2017 capped that deduction at $10,000 in what was seen as a political slap at Democratic-leaning states in the Northeast and California, where residents often pay much more than that state and local taxes.
A proposal in the current tax bill calls for that deduction to be raised to $30,000, but that is still not high enough for a number of GOP lawmakers from those blue states.
Sources said that five members of the SALT Caucus” remain “no” votes on the current bill after Trump’s visit, and after Republican leadership proposed boosting the cap slightly.
On Monday, GOP leaders offered a $40,000 cap on deductions, two sources said. One source said that the cap only would apply to people earning $751,600 per year or less, and that the cap would remain in place for four years before eventually decreasing to $30,000 for people making $30,000 or less.
Trump, in his visit Tuesday to meet with Republican House members, told the SALT Caucus, “Let it go,” NBC News reported.
The president was blunter to Rep. Mike Lawler, a New York Republican who is among the holdouts on the bill.
“I know your district better than you do,” Trump told Lawler, according to a tweet by Punchbowl News co-founder Jake Sherman.
“If you lose because of SALT, you were going to lose anyway,” Trump reportedly said to Lawler.
Sources who spoke to CNBC confirmed the accuracy of Sherman’s account.
Trump and Johnson’s efforts to get the tax bill passed have also been frustrated by conservatives who want to cut the federal budget deficit and cut more from the Medicaid health coverage program than the current iteration of the bill proposes.
Trump told the caucus, “Don’t f— around with Medicaid,” on Tuesday.