House Republicans warn Senate changes to the SALT deduction cap could unravel Trump’s major tax agenda bill.

Blue State Republicans Push Back Against Senate Tax Rewrite

House Republicans representing high-tax blue states issued stern warnings Monday after reports surfaced that Senate GOP leaders plan to lower the state and local tax (SALT) deduction cap in President Donald Trump’s sweeping legislative agenda. The potential rollback has ignited a fierce backlash among lawmakers from New York, New Jersey, and California, who argue that capping deductions would disproportionately harm their constituents and threaten Republican unity.

Rep. Mike Lawler, R-N.Y., responded sharply to the prospect, declaring on social media that any Senate move to restore the $10,000 cap would be “dead on arrival.” The Senate Finance Committee, responsible for the tax provisions in the “big, beautiful bill,” is preparing to unveil its version, but House Republicans say changes to SALT are non-negotiable. “It only takes three ‘no’ votes in the House to kill any bill,” Lawler warned, referencing the GOP’s slim majority.

SALT deductions, initially capped at $10,000 by Trump’s 2017 Tax Cuts and Jobs Act, have been a rallying point for lawmakers in districts with high state and local taxes. For this legislative round, the House GOP bill had raised the cap to $40,000 for filers making up to $500,000—a hard-fought compromise designed to secure support from blue state Republicans. The Senate’s possible reversion to the lower cap, however, has rekindled divisions within the party.

Rep. Nicole Malliotakis, R-N.Y., a member of the House Ways and Means Committee, criticized the Senate’s position, stating, “The $40,000 SALT deduction was carefully negotiated along with other tax provisions by the House. For the Senate to leave the SALT deduction capped at $10,000 is not only insulting but a slap in the face to the Republican districts that delivered our majority.”

Lawmakers insist the increased cap is essential to fulfilling promises made to voters and warn that the GOP could lose the House if the final bill does not address the concerns of constituents in blue states. SALT Caucus co-chairs Reps. Young Kim, R-Calif., and Andrew Garbarino, R-N.Y., emphasized in a joint statement that the negotiated cap “must remain in the final bill,” citing its benefits for middle-class families, small business owners, and essential workers.

The ongoing dispute threatens to derail the legislative process, as just three defections could doom the bill in the closely divided House. Last-minute negotiations prior to the recent House vote secured the $40,000 cap, a critical factor in the bill’s narrow passage. With the Senate now finalizing its version, House Republicans are demanding that their compromise be preserved to avoid risking party unity and key legislative wins for the Trump administration.

The Senate is expected to release its full version of the tax package soon, as leaders aim to resolve intraparty differences and send the bill back to the House in time for President Trump’s signature by July 4. The outcome will test the GOP’s ability to balance the interests of its diverse coalition and deliver on its promises of tax relief and legislative achievement.