House Republicans crafting the renewal of President Donald Trump’s 2017 tax cuts may add multiple measures that would raise taxes on businesses, corporations and the richest people in the country. The proposals include ending tax breaks for sports team owners and increasing the tax on stock buybacks.
Punchbowl News reported on Friday, April 25, that the House Ways and Means Committee is considering multiple options to offset a projected revenue loss from tax breaks for individuals and corporations.
What are the proposals?
- Legislators might eliminate a tax break for purchasing a sports team. Owners can deduct the cost of purchasing the team from their taxes over a 15-year period.
- Lawmakers could raise the current 1% tax on stock buybacks. A new rate has not been made public.
- They may also raise the 1.4% endowment tax on universities, which was first created in 2017. It’s not known what the higher rate could be.
- In addition, lawmakers are looking at putting a new cap on state and local tax deductions for businesses.
Right now, corporations can deduct state and local income, property and/or sales tax from their federal taxable income, according to the University of Pennsylvania’s Wharton School.
Do all Republicans support these measures?
Republicans in blue states could wield significant influence over the reconciliation bill. Their votes are needed to pass it, and their seats are necessary if Republicans are to hold the majority after the 2026 midterms.
These lawmakers are using that leverage to get the individual state and local tax deduction, or SALT, included in the legislation.
This deduction allows individuals to claim local taxes as a write-off on their federal return. It is particularly important to those residing in high-tax states, such as New York, New Jersey and California.
Republicans in those states are pushing to get SALT in the reconciliation bill.
The 2017 Tax Cuts and Jobs Act lowered the individual state and local deduction from $25,000 to $10,000.
Some members of the GOP, according to Punchbowl, want to see the cap increased.
“Our party can’t afford to take our votes for granted, and securing them means significantly raising the SALT cap,” Rep. Nick LaLota, R-N.Y., told Punchbowl. “This isn’t just policy — it’s about fairness, political reality and simple vote math.”
Other conservatives opposed the SALT deduction and said it’s a federal subsidy that makes local tax hikes easier to stomach.
Republican leadership said it wants to pass the bill by Memorial Day.
