White House officials are close to reaching an agreement on the state and local tax deduction (SALT) provision, a critical component of the GOP’s megabill. The negotiations involve a complex interplay between Senate Republicans and House GOP members, particularly those who are holdouts on the issue. Treasury Secretary Scott Bessent, who is leading the negotiations, is set to attend a lunch for Senate Republicans today to discuss the pending deal. According to three sources with direct knowledge of the talks, significant progress has been made in recent days, although some compromises remain. Speaker Mike Johnson, who has been at the forefront of these discussions, reported that there was ‘a lot of progress yesterday’ at a meeting with SALT Republicans and Treasury officials. However, he acknowledged that no one would be fully satisfied with the outcome, as this is a politically complex issue. Johnson also noted that while the SALT issue is being resolved, other aspects of the megabill may still require attention before the final agreement can be reached.
Despite the progress, some hard-line holdouts, such a Rep. Nick LaLota of New York, remain skeptical. LaLota has stated that he is not part of the deal, highlighting the ongoing resistance within the party. According to the sources, the prospective deal would maintain the House-passed cap of $40,000 for five years before reverting to the current $10,000 cap. The deal is currently structured around a $240 billion price tag, which is $100 billion less than the original House proposal. However, the deal still needs to be sold to GOP senators, who will have their own discussions and deliberations. Sen. Markwayne Mullin (R-Okla.), who has been instrumental in brokering the agreement, admitted that he never thought a deal would be accepted by all involved. His goal has been to ensure that the provisions are substantial enough to make it difficult for senators to vote against the agreement. The negotiations continue, with the final approval of the SALT deal depending on the ability to secure broad support among GOP senators and members.