SALT Deduction Relief Included in Sanders Budget Proposal

Senate Budget Committee Chairman Bernie Sanders is proposing to partially revive the federal deduction for state and local taxes in a draft outline of a budget resolution designed to fast-track much of President Joe Biden’s economic agenda.

A draft of Sanders’s plans, obtained by Bloomberg, offers a side-by-side comparison of Biden’s agenda to the Vermont independent’s ideas, and includes long-standing goals for progressives on health care, prescription drugs and housing.

See the budget-comparison proposal here

The proposal doesn’t specify how the state and local tax, or SALT, write-off proposal would work. But it provides a template for how Democrats could reach an agreement about how to address the tax break, that is a key priority for Democrats representing high-tax states, including New York and New Jersey.

Sanders in an interview said he and fellow Democrats are still working out the details of the SALT cap issue, but he indicated it would not be a full repeal for all taxpayers and wouldn’t include the wealthiest.

“Do I think billionaires should receive a tax break in that area? I don’t,” he said.

Biden did not address the SALT deduction in his American Jobs Plan or American Families plan, and White House Press Secretary Jen Psaki has said that it’s up to Congress to decide how to find offsets to pay for the more generous tax break.