Washington — Senate Republicans on Monday released details on the most contentious elements of the sweeping legislation to enact President Trump’s second-term agenda.
The Senate Finance Committee unveiled its portion of Mr. Trump’s “big, beautiful bill,” which makes changes to the tax and Medicaid provisions in the version that narrowly passed the House last month.
Senate Republicans are aiming to make key progress this week in their effort to approve the legislation, but some of the key sticking points still appear unresolved, making it less certain they’ll get the bill to Mr. Trump’s desk by their self-imposed deadline of July 4.
Medicaid and provider taxes
GOP senators have proposed steeper cuts to Medicaid funding by lowering provider taxes — which states use to help fund their share of Medicaid costs — from 6% to 3.5% by 2031. The House bill seeks to lower federal costs by freezing states’ provider taxes at current rates and prohibiting them from establishing new provider taxes.
Several Republicans have said the bill could lose their support if the provider tax were to be frozen or decreased, pointing to the potential negative impact on rural hospitals.
SALT — the state and local tax deduction
The Senate version proposes permanently extending the $10,000 state and local tax deduction, known as SALT. It’s a considerable difference from the House measure, which increases the deduction from $10,000 to $40,000 per household for incomes up to $500,000.
House Republicans from blue states threatened last month to withhold their support for the bill if the cap were not raised and quickly said Monday they’d vote against the package when it comes back to the House. House Speaker Mike Johnson, a Louisiana Republican, has urged senators to make as few changes to the legislation as possible, noting that he can afford to lose just a few votes with his narrow majority.
Senate Majority Leader John Thune, a South Dakota Republican, called the $10,000 cap a starting point.
“We understand that it’s a negotiation,” he told reporters Monday evening. “Obviously, there had to be some marker in the bill to start with, but we’re prepared to have discussions with our colleagues here in the Senate and figure out a landing spot.”
Debt ceiling increase
Senate Republicans are also calling for a $5 trillion increase in the debt ceiling — $1 trillion above the limit set by the House. The Child Tax Credit would increase to $2,200 under the Senate bill, $300 less than the House-passed hike.
Taxes on tips, auto loan interest
The Senate version also includes provisions to end taxes on tips, overtime and auto loan interest, while making tax cuts enacted during Mr. Trump’s first term permanent.
Republican leaders have been pushing to get the legislation to the president’s desk by early July. But with a short week this week, Senate Republicans need to move quickly in the coming days to put the legislation on a course for passage in the upper chamber before it returns to the House for sign-off on the changes.
Thune said he plans to bring up the budget agenda for a vote next week, but he has threatened to keep senators in Washington, D.C., over the Fourth of July recess to pass it, since several Republicans have expressed doubt about the upper chamber’s ability to finish its work on the bill before the self-imposed deadline.
“We need to get it done,” Thune told Fox News on Sunday. “We will roll into the Fourth of July recess if necessary, in order to get this on the president’s desk.”
contributed to this report.
