The Trump Administration has proposed a new regulation that would limit the amount of state and local tax deductions, known as SALT, that taxpayers can claim, including a cap on the state and local sales tax deduction. This move is seen as an attempt to reverse a provision of the 2017 Tax Cuts and Jobs Act, which had temporarily raised the cap on the SALT deduction. The new regulation is expected to affect high-tax states like New York and California, where residents have been using the SALT deduction to offset the high state and local taxes. The proposal has sparked criticism from Democrats and some Republicans, who argue that it would disproportionately impact middle-class taxpayers in high-tax states.
