Update, Thursday, June 1, 1:30 p.m.: The House of Representatives voted 314 to 117 on Wednesday night to suspend the debt ceiling for two years and set federal spending limits, sending the Fiscal Responsibility Act to the Senate, which was to take quick action to avert a default before Monday.
Representative Nick LaLota of New York's First Congressional District voted with the majority and issued a statement that night. “The bipartisan Fiscal Responsibility Act is a first step toward addressing the nation's debt crisis by limiting spending and reducing the deficit in exchange for raising the debt ceiling," he said. "While the bill doesn’t have everything Republicans wanted, we were able to claw back billions in unobligated Covid funds, ensure a strong military, cut bureaucratic red tape, and protect our seniors, working families, children, and veterans. While I was disappointed my SALT amendment was not included in the final bill I will continue to fight to give tax relief to Long Island families. I urge the Senate to swiftly take up this bipartisan win for the American people and send it to the president’s desk.”
Originally, Wednesday, May 31: Representative Nick LaLota of New York’s First Congressional District and two of his Republican colleagues in the state’s congressional delegation have submitted Mr. LaLota’s SALT Fairness and Deficit Reduction Act to the House Rules Committee as an amendment to the Fiscal Responsibility Act, passage of which must happen by Monday in order to avert the country’s defaulting on its debt.
Introduced by Mr. LaLota last month, the SALT Fairness and Deficit Reduction Act would significantly raise the $10,000 cap on local and state taxes that can be deducted from income on federal tax returns. The cap was imposed in the 2017 tax overhaul that critics say was not only tilted to benefit the wealthy and corporations but also served to punish residents of higher-income, Democratic-leaning states like New York and New Jersey.
Mr. LaLota’s proposed legislation would raise and extend the SALT deduction cap from $10,000 to $60,000 for single filers, and to $120,000 for joint filers, starting in 2023 and lasting until Dec. 31, 2032.
In a statement on Tuesday, Mr. LaLota said, “I came to Congress promising to take every opportunity I could to restore the SALT deduction and support Long Island families. My amendment would insert the text of my SALT Fairness and Deficit Reduction Act into the Fiscal Responsibility Act, providing more tax relief for Americans and doing even more to address our federal deficit.”
In submitting the act as an amendment, Mr. LaLota was joined by Representatives Anthony D’Esposito and Mike Lawler, of the Fourth and 17th Congressional Districts, as co-sponsors.
President Biden and Representative Kevin McCarthy, the speaker of the House, had reached agreement in principle on Saturday to suspend the debt ceiling, the total amount of money that the government is authorized to borrow to meet existing obligations such as Social Security and Medicare benefits, military salaries, interest on the national debt, tax refunds, and other payments, according to the Treasury Department. Enacted in 1917, the debt ceiling, now set at $31.4 trillion, has been raised 78 times since 1960, 49 times under Republican presidents and 29 times under Democratic presidents.
This year, as they have previously, Republicans, who hold a slim majority in the House of Representatives, threatened to allow the United States to default on its debt, which experts say would have a severely adverse impact on the national and world economies, unless sharp spending cuts and work requirements were enacted in order to receive food stamps or money from the Temporary Assistance for Needy Families program. The Treasury Department has identified Monday as the date on which the United States will run out of money and be unable to meet its obligations, should the debt ceiling not be raised or suspended.
While the House Rules Committee voted on Tuesday to advance the Fiscal Responsibility Act to the full House to debate the plan, its passage was far from assured as of yesterday morning. While the proposal has bipartisan support, there are critics on both the left and right of the political spectrum, and many House Republicans were expected to vote against the bill. A final vote was to happen last night. The Senate, where it also faces opposition, would then take up the matter.
“The bipartisan Fiscal Responsibility Act already provides much-needed support to the American people while addressing spending; adding my legislation would take it another step in the right direction,” Mr. LaLota’s statement said. “I am hopeful that the House Rules Committee will allow my amendment to be considered on the House Floor to give Long Islanders tax relief while cutting costs down the road.”
