Sanders signals openness to adjusting SALT cap

The cap primarily increases the tax bills of higher-income residents of high-tax states like New York and California.

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Sanders signals openness to adjusting SALT cap to retain key votes as he maneuvers to pass Biden’s agenda.

Senator Bernie Sanders, independent of Vermont, signaled an openness to adjusting the cap on how much taxpayers can deduct in state and local taxes.Credit…Stefani Reynolds for The New York Times

June 22, 2021, 9:31 p.m. ET

Senator Bernie Sanders, the Vermont independent in charge of the powerful Senate Budget Committee, signaled on Tuesday an openness to adjusting the cap on how much taxpayers can deduct in state and local taxes as he seeks to secure the support of nearly every Democrat in Congress for a multitrillion-dollar economic package.

Some congressional Democrats have warned that they may not support any changes to the tax code that do not also address that provision, put in place during the Trump administration, because of the impact on their constituents.

A draft budget document circulated by staff members on Capitol Hill and obtained by The New York Times included money to address the cap, which primarily increases the tax bills of higher-income residents of high-tax states like New York and California. The funding was not included in Mr. Biden’s original proposals and could amount to a partial repeal of the cap for some taxpayers.

“I have a problem with extremely wealthy people being able to get the complete deduction,” Mr. Sanders said in an interview, though he did not comment on specific details. “I think that’s an issue we’ll have to work on.”

Democrats have begun to move forward to pass some, if not all, of Mr. Biden’s economic agenda through the fast-track budget reconciliation process in order to bypass a Republican filibuster in the Senate. But the openness from Mr. Sanders underscored the breadth of compromises that rank-and-file lawmakers may have to accept to secure the necessary support of all 50 senators who caucus with Democrats and nearly every House Democrat.

Mr. Sanders, who has pushed for as much as $6 trillion in spending should bipartisan negotiations on a narrower infrastructure package collapse, said he had asked Democrats on his committee to outline their priorities as he moves to build consensus around an outline.

“OK, look, what do you think? What kind of numbers you’re comfortable with? And where would you like to cut back?” Mr. Sanders said as he described his approach. “We haven’t heard a lot about the cutting back.”

But he acknowledged the challenge in such maneuvers even as he pushes for various liberal priorities, including expanding Medicare benefits and eligibility and more spending. “We’re going to have to make sure that we end up with numbers that 50 members can agree on,” he said.

Mr. Sanders said he had not yet received a commitment from every senator for a $6 trillion package, even as he warned that a bipartisan infrastructure agreement would clear the Senate only with the promise that every Democrat would also support a reconciliation package.

“We’re going to have to work hard, and, you know, make some trade-offs, and so forth and so on,” he said. “I am more than willing to speak to every member and hear what they have to say.”

Biden’s 2022 Budget

A new year, a new budget: The 2022 fiscal year for the federal government begins on October 1, and President Biden has revealed what he’d like to spend, starting then. But any spending requires approval from both chambers of Congress.Ambitious total spending: President Biden would like the federal government to spend $6 trillion in the 2022 fiscal year, and for total spending to rise to $8.2 trillion by 2031. That would take the United States to its highest sustained levels of federal spending since World War II, while running deficits above $1.3 trillion through the next decade.Infrastructure plan: The budget outlines the president’s desired first year of investment in his American Jobs Plan, which seeks to fund improvements to roads, bridges, public transit and more with a total of $2.3 billion over eight years.Families plan: The budget also addresses the other major spending proposal Biden has already rolled out, his American Families Plan, aimed at bolstering the United States’ social safety net by expanding access to education, reducing the cost of child care and supporting women in the work force.Mandatory programs: As usual, mandatory spending on programs like Social Security, Medicaid and Medicare make up a significant portion of the proposed budget. They are growing as America’s population ages.Discretionary spending: Funding for the individual budgets of the agencies and programs under the executive branch would reach around $1.5 trillion in 2022, a 16 percent increase from the previous budget.How Biden would pay for it: The president would largely fund his agenda by raising taxes on corporations and high earners, which would begin to shrink budget deficits in the 2030s. Administration officials have said tax increases would fully offset the jobs and families plans over the course of 15 years, which the budget request backs up. In the meantime, the budget deficit would remain above $1.3 trillion each year.

Speaker Nancy Pelosi of California and Senator Chuck Schumer, Democrat of New York and the majority leader, were expected to meet with White House officials Tuesday evening to discuss both bipartisan talks and the reconciliation process.

Among those expected to attend the meeting, according to an official familiar with the plans, were Brian Deese, the director of the National Economic Council; Steve Ricchetti, a top adviser to Mr. Biden; Louisa Terrell, the director of the White House Office of Legislative Affairs; Shalanda Young, the acting director of the Office of Management and Budget; and Susan Rice, the White House domestic policy adviser.

The meeting comes after a series of lengthy huddles on Tuesday between a bipartisan group of centrist senators and White House officials. Those talks, spearheaded by Senators Rob Portman, Republican of Ohio, and Kyrsten Sinema, Democrat of Arizona, are expected to continue Wednesday.

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