Wealthy Democrat donors likely to benefit from Democrats' repeal of SALT cap

Some of the wealthiest and most prolific Democratic donors are likely to benefit financially if Democrats are successful in repealing a Trump-era limit on state and local tax (SALT) deductions.

The so-called SALT deduction cap, which is due to expire in 2026, limits the amount of state and local taxes that Americans can deduct from their federal taxes to $10,000. However, Democrats in high-tax states like New York, New Jersey and California have been demanding for months that the cap be increased as part of President Biden's $1.75 trillion Build Back Better spending plan.

House Democrats initially were pushing for the SALT cap to be increased from $10,000 to $72,500, but a last-minute amendment earlier this month hiked the cap up to $80,000. 

If the proposed cap on SALT isn't scrapped and Democrats pass the massive spending bill, many of the top Democratic donors in California and New York would personally benefit, including failed presidential candidates Tom Steyer and Michael Bloomberg, who both donated tens of millions of dollars to Democrats during the 2020 election cycle.

Other top Democratic donors who could be benefitting from repealing the SALT cap, include the billionaire married couples of Dustin and Cari Moskovitz of California and James and Marilyn Simons of New York. Billionaire Linkedin co-founder Reid Hoffman of California is also on the list.  

PELOSI DEFENDS SALT DEDUCTION IN DEMS' SPENDING BILL, INSISTS IT WON'T BENEFIT THE RICH

House Speaker Nancy Pelosi, D-Calif., on Thursday claimed repealing the $10,000 SALT cap, which she supports, was "not about tax cuts for wealthy people" and pushed back against a reporter for asking whether the top sliver of U.S. households would benefit, saying, "That isn't the result."

Pelosi, who is worth tens of millions of dollars and represents a wealthy California district, initially started the push for a stimulus bill last year that would roll back the SALT cap from the Trump administration. 

However, Marc Goldwein, the senior vice president for the non-partisan Committee for a Responsible Federal Budget, called the SALT cap repeal "a 
massive tax cut for the rich." 

Several Democrats in the House and Senate blasted their colleagues who support the SALT cap repeal, including Sen. Bernie Sanders, I-Vt., who caucuses with the Democrats, Sen. Jon Tester, D-Mont., Rep. Jared Golden, D-Maine, and others, Politico reported.

MOST MILLIONAIRES WOULD RECEIVE A TAX CUT UNDER DEMOCRATS' LATEST SPENDING PROPOSAL: ANALYSIS

"Let me say it again. You can’t be a political party that talks about demanding the wealthy pay their fair share of taxes and then end up with a bill that gives large tax breaks to many millionaires," Sanders tweeted Thursday. "You can’t do that. The hypocrisy is too strong. It’s bad policy, it’s bad politics."

Tester said he does not agree with the repeal of the SALT cap because he believes "it gives tax breaks to the wrong people: Rich people." His Democratic Senate colleague, Michael Bennet of Colorado, agreed, calling it "preposterous" that the "House proposal on SALT gives more than 70% of its benefits to the wealthiest 5%."

Golden blasted the SALT plan on Twitter Wednesday evening by saying he felt like "Republicans were in charge."

"Proponents have been saying that the BBB taxes the rich. But the more we learn about the SALT provisions, the more it looks like another giant tax break for millionaires," Golden tweeted. "The fact that more people and orgs on the Democratic side aren’t up in arms about this is wild."

CLICK HERE TO READ MORE ON FOX BUSINESS

However, Reps. Gregory Meeks, D-N.Y., Josh Gottheimer, D-N.J., and others support the repeal of the SALT cap. Meeks said Trump's "intent was to penalize blue states — I’m not going to let them get away with that."

A recent analysis from the nonpartisan Tax Policy Center found that two-thirds of people making more than $1 million a year would receive an average tax cut of $16,800 next year under the "Build Back Better" spending bill largely due to the removal of the SALT cap if it's passed. 

Another analysis from the non-partisan Committee for a Responsible Federal Budget found that middle-class Americans would receive an average tax cut of roughly $20 per year compared to the highest earners, who would receive an average tax cut of $23,000 per year.

Fox News' Megan Henney and Matthew Wall contributed to this report.