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April 25, 2025
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PRESENTED BY
THE TOP
Booker backs Schatz. And some new details on the House GOP tax plan.
Happy Friday morning.
Breaking news: Sen. Brian Schatz (D-Hawaii) is picking up a key endorsement in his yet-to-be-announced bid to become the next Senate Democratic whip.
Sen. Cory Booker (D-N.J.), who was floated as a potential contender for the job, told us that Schatz has his “full, unqualified support” for the No. 2 Senate Democratic leadership post.
Schatz hasn’t officially jumped into the contest but is seen as the frontrunner and has been making calls to Democratic senators.
Here’s what Booker told us:
Sen. Dick Durbin (Ill.), the Democratic whip, announced his retirement Wednesday. The slot won’t open up until after the 2026 election, but Schatz and other hopefuls will spend the next 19 months lobbying colleagues for their support.
Tax news: House Republican tax writers have been soft-selling to corporate lobbyists a new cap on businesses’ state and local tax deductions. The effort is a sign that Republicans are seriously considering including the tax hike in their reconciliation package.
Remember, House Republican leadership is pushing to pass the reconciliation bill by Memorial Day. The Ways and Means Committee hasn’t finalized its tax plans yet, and the real test of the GOP’s search for revenue will begin when members return to town next week.
But here’s what’s being considered, per key players on the Hill and downtown.
1) A new cap on business SALT.
This may be an easier sell if Republicans planned to cut the corporate income tax rate. But several people told us that the current 21% corporate rate will go untouched. Republicans could move to only limit deductions for businesses’ state income taxes. Capping property tax deductions would ignite more GOP backlash.
If Ways and Means includes a business SALT cap in its proposal, there will be a bitter fight ahead with corporate America and conservative groups.
2) Cracking down on sports team owners’ tax breaks. A tax hike for mega-wealthy people who own professional teams is among President Donald Trump’s personal priorities for the tax bill.
Under one construct being discussed, the sports-owner tax increase could strip team owners of their ability to deduct the cost of buying a team over 15 years.
3) Ways and Means is also seriously considering increasing the endowment tax on colleges and universities. Schools like Harvard University and Columbia University – which have multi-billion dollar endowments — have become major Republican targets. House tax writers have considered a range of increases to the endowment tax.
4) Raising the tax on public companies’ stock buybacks. The tax is currently at 1%.
The big picture: There’s heavy pressure from conservative House Republicans to find offsets. The White House is looking at a four-year timespan for Trump’s priorities of no taxes on tips, overtime pay and Social Security benefits, as we scooped. Those provisions could carry a heavy price tag.
Even though the potential tax increases for corporate America — SALT deductions in particular — are causing heartburn on K Street, there are likely to be plenty of big wins for the business world in the bill.
Ways and Means is planning to revive tax breaks for research and development, interest expenses and purchases of short-term assets like equipment and machinery. Republicans will try to extend these provisions permanently, according to multiple sources.
Here’s more news: Blue-state Republicans, House GOP leaders and Ways and Means Committee Chair Jason Smith (R-Mo.) are meeting on the personal SALT cap Wednesday afternoon.
This will be a big moment for Republicans to resolve one of the most politically fraught problems for the tax bill. Most Republicans support the current $10,000 SALT cap. But a handful of blue-state GOP lawmakers have vowed to vote against a tax package unless the cap is increased to at least $25,000, as we scooped.
“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.) said. “This isn’t just policy — it’s about fairness, political reality and simple vote math.”
Rep. Nicole Malliotakis (R-N.Y.), a Ways and Means member, said she’s optimistic about striking a SALT deal that would benefit her Staten Island and Brooklyn district. “I’m focused on the middle class, and I think we can achieve a number that would provide the relief needed for the people I represent,” Malliotakis said.
Also: GOP leadership aides and committee staffers are expected to work through reconciliation plans for the next few weeks during a 10 a.m. meeting this morning.
House Republican leaders have been asking committees to hold markups over the next two weeks, a very ambitious timeline.
— Andrew Desiderio, Laura Weiss and Jake Sherman
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THE SENATE
An unlikely bipartisan duo: Banks and Gallego
At a time when voters are clamoring for generational change in Washington, Sens. Ruben Gallego (D-Ariz.) and Jim Banks (R-Ind.) are looking to capitalize on that sentiment.
Gallego and Banks, who were elected to the Senate in November after serving in the House together, have long been seen as partisan warriors with bright futures in their respective parties.
But the two have a lot in common. They’re both 45 years old, have young kids, served in the military and come from working-class backgrounds. And both senators love reminding anyone who will listen that they’re decades younger than many of their colleagues.
Their Senate “long game” — both as party messengers but also as an unlikely bipartisan duo — began last week with a four-day swing through Slovakia, Germany and the United Kingdom.
“We plan on being around for a long time. And building these relationships abroad and working on these issues together is something we plan on doing for a long time to come,” Banks said in a joint interview with Gallego.
Overlapping agenda: The freshman senators overlapped in the House for eight years. They both served on the Armed Services Committee and traveled abroad together.
Gallego and Banks say they want to use that bond to their advantage. Not just to help their own parties, but to address big challenges that require bipartisan buy-in. That includes ensuring effective deterrence in Europe and Asia, as well as caring for U.S. veterans.
“We have ‘same eyes, different lenses,’ but he’s experienced the same ups and downs [in life],” Gallego said.
Banks said the pair is interested in starting a Senate working group focused on the Nordic region, especially given President Donald Trump’s focus on Greenland.
The long game: Both men made it clear that despite their interest in working together, they’re still party loyalists.
Banks enthusiastically backed up Defense Secretary Pete Hegseth, who’s been mired in yet another Signal-related scandal. Meanwhile, Gallego praised Sen. Chris Van Hollen (D-Md.) for his visit to El Salvador, where he met with an undocumented Salvadoran immigrant who was mistakenly deported there.
Gallego said his personal goal with last week’s bipartisan CODEL was to remind U.S. allies that “there’s still a U.S. Senate” despite the “rough patch” brought on by Trump. Banks echoed Trump’s message of a renewed focus on China and encouraging Europe to do more to counter Russia.
It’s worth noting that Gallego comes from a purple state that Trump won in November. He does sometimes criticize his party.
Although he’s a staunch Trump supporter, Banks has long encouraged the GOP to focus more on the needs of the working class.
“The next generation of American politics is gonna be determined by whether Republicans keep the working-class vote… or whether Ruben’s party is able to pull [them] back,” Banks said.
— Andrew Desiderio
PRESENTED BY BETTER MEDICARE ALLIANCE
Over 34 million Americans depend on Medicare Advantage for affordable health coverage.
Coinbase targets state holdouts with new campaign
First in The Vault: Coinbase is launching a campaign against four state governments that have refused to drop lawsuits to prevent the U.S. crypto exchange from providing staking services to their residents.
Coinbase, like much of the American crypto sector, has seen its legal prospects brighten with the change in administrations. The Securities and Exchange Commission has abandoned its Biden-era litigation against Coinbase. But four holdouts – Wisconsin, Maryland, New Jersey and California – have declined to drop their lawsuits.
The new campaign will tell customers just how much money they’ve lost out on as litigation blocks Coinbase from offering staking rewards.
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“Staking” is the process used by some crypto products to verify digital asset transactions. Coinbase customers who stake their assets are eligible for rewards. The U.S. exchange maintains that none of their customers has ever lost staked assets.
In a video you can watch here, Coinbase warns that “staking is still at stake” with these outstanding lawsuits.
The campaign will also list off Coinbase’s estimates for how much each states’ residents could have earned. For each respective state, that’s a $2 million figure for Wisconsin, $5 million for Maryland, $12 million for New Jersey and $71 million for California.
This effort will start off with digital ad buys. A representative for Coinbase declined to share any initial ad buy estimate.
This is a fast-moving area of litigation. Of the 10 states that joined the Biden SEC’s lawsuit against Coinbase, a majority have already dropped lawsuits that prevent staking in their jurisdictions, including Illinois, Kentucky, Vermont, South Carolina and, just this week, Alabama.
– Brendan Pedersen
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THE CAMPAIGN
Conservative ad buy promotes Trump’s tax plan
Plymouth Union Public Advocacy is launching a five-figure digital ad buy promoting President Donald Trump’s tax agenda. The 30-second spot will air in Washington starting today.
The ad, titled “Finish the Job,” urges Republican lawmakers to support Trump’s proposal to eliminate taxes on tips, overtime pay and Social Security benefits.
The spot will air as House committees prepare to consider these policies in reconciliation markups next week. The ad buy is part of a $1 million campaign by PUP Advocacy aimed at advocating for Trump’s economic agenda.
PUP Advocacy is made up of the former heads of the Republican Governors Association, the Republican State Leadership Committee and the Republican Attorneys General Association.
Senate news: Illinois Democratic Gov. JB Pritzker is expected to endorse Lt. Gov. Juliana Stratton on Friday morning in the race for the state’s open Senate seat. Pritzker will back Stratton at an event in the South Side of Chicago, per a source close to Stratton’s campaign.
– Mica Soellner
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