Cart Refresh Disabling Functions.php

After a few hours we have narrowed down our issue to the FDP

We have this code in our functions.php that quite simply takes $350 off all package rates if the cart is over 4500. However, with FDP enabled – you will notice that the $350 deduction is visible on first load of the Checkout Page, but the cart contents will be refreshed by another ajax call and reset to their original state, removing the $350 discount.

I have enabled all plugins on the checkout page
I have disabled all plugins on the checkout page
I have toggled off the checkout page
Does not work

The only thing that works is disabling FDP altogether. Code is below

// [DO NOT ENQUE] $350 Discount on Shipping if Cart is Over 4500 [Shipping Pages Only]
function apply_shipping_discount( $rates ) {
    
    if ( ! is_checkout() ) {
        return $rates;
    }
    
    $cart_total = WC()->cart->get_subtotal();
    if ( $cart_total > 4500 ) {
        $discount_amount = 350;
        foreach( $rates as $key => $rate ) {
            $rates[$key]->cost = $rates[$key]->cost - $discount_amount;

        }
    }
    return $rates;
}
add_filter( 'woocommerce_package_rates', 'apply_shipping_discount' );

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