WASHINGTON — Republican leaders are running into a number of roadblocks as they race to finalize President Donald Trump’s massive tax reconciliation package before their self-imposed deadline of Memorial Day — with several variables left unresolved.
Three House committees are expected to mark up their portions of the budget proposal early next week containing the most important components of the bill. The other eight committees have already advanced their portions of the budget package.
However, the final details of the remaining bills have not yet been released — and several proposals are still undecided.
The committees must follow instructions passed earlier this year that give each panel specific guidelines for how much spending to cut or how to allocate increased spending.
The remaining committees must find roughly $1.1 trillion in spending cuts to offset the $4.5 trillion being allocated to the Ways and Means Committee to extend the tax cuts previously approved in Trump’s 2017 Tax Cuts and Jobs Act.
But finding those cuts has proven to be more difficult than Republicans anticipated, which could limit the tax extensions. If those spending reductions can’t be found, it could decrease the amount of the tax cuts Trump can extend.
When Republicans drafted their first budget reconciliation resolution, they included an amendment to “adjust the dials” on tax cuts depending on how much government spending is cut. That means if committees do not reach the $1.5 trillion floor, the tax cuts must “be lowered dollar-for-dollar to keep the reconciliation bill within the agreed limits.”
And some Republicans are demanding to keep that agreement in check.
Ways and Means Committee
Monetary instructions: $4.5 trillion increase.
Status: Awaiting legislative text. Markup tentatively scheduled for Tuesday.
Background: The Ways and Means Committee is set to meet on Tuesday at 2 p.m., according to sources familiar with planning.
It’s expected to be a marathon session to hash out the details of roughly $4.5 trillion to extend the 2017 tax cuts before they expire at the end of this year. This portion of the bill is arguably the most crucial piece of the reconciliation package, and it’s been the most difficult to negotiate across the Republican conference.
One of the most complicated matters still being hashed out is how much to expand federal deductions for state and local taxes paid, also known as SALT. While the issue does not affect most Republicans, there are several in blue-majority states who have made it a crucial issue — even going so far as to threaten final passage if it’s not included.
One of the proposals to those SALT Republicans was to increase the current deduction cap to $30,000, up from the current $10,000 limit. However, that offer was resoundingly rejected in a joint statement by New York Reps. Elise Stefanik, Mike Lawler, Nick LaLota, and Andrew Garbarino.
“It’s not just insulting — it risks derailing President Trump’s One Big Beautiful Bill,” they wrote. “New Yorkers already send far more to Washington than we get back — unlike many so-called ‘low-tax’ states that depend heavily on federal largesse. A higher SALT cap isn’t a luxury. It’s a matter of fairness.”
There are other proposed caps under discussion, according to the speaker’s office, and there’s been “a lot of analysis that’s gone into it.”
Energy and Commerce Committee
Monetary instructions: $880 billion in spending cuts.
Status: Awaiting legislative text. Markup tentatively scheduled for Tuesday.
Background: The Energy and Commerce Committee is also expected to meet at 2 p.m. on Tuesday for its markup, which is likely to drag on for hours with few or no breaks.
The panel is tasked with deciding how much to cut in Medicaid spending and where to find those cost reductions — a conversation that has plagued GOP lawmakers for weeks as they continue to debate how much to pare away at the welfare program.
The committee is instructed to find at least $880 billion in spending cuts, and much of that is expected to come from Medicaid due to the committee’s realm of jurisdiction. Many considerations — such as implementing per capita caps on Medicaid costs or shifting more financial responsibility to individual states — are still on the table and have not been finalized.
However, some Republicans are refusing to vote for anything that would divert funds away from hospitals or patients. Rep. Don Bacon, R-Neb., for one, says he won’t vote for more than $500 billion in cuts to Medicaid — and even then, spending reductions would need to meet certain requirements.
“Those are the cuts that don’t impact quality of care nor hurt hospitals,” Bacon told the Deseret News. “A bunch of us will have to be convinced that any other cuts won’t hurt patients or hospitals.”
Other Republicans hold similar sentiments, with a dozen lawmakers sending a letter to GOP leadership last month threatening to withhold support from the massive tax reconciliation bill if the package includes substantial cuts to Medicaid for vulnerable populations.
Agriculture Committee
Monetary instructions: $230 billion in spending cuts.
Status: Awaiting legislative text and scheduled markup.
Background: The Agriculture Committee will meet on Tuesday evening to hash out its budgetary plans as they look to find $230 billion in spending cuts.
This markup is also expected to cause some heartburn as lawmakers consider cutting assistance to crucial benefits such as low-income food programs like SNAP.
Republicans will also push to include portions of the farm bill, a comprehensive piece of legislation overseeing agricultural and food policies that must be renewed every five years. However, its renewal over the last few years has been continually punted as lawmakers have struggled to negotiate bipartisan policies.
Republicans are considering a slew of other measures to cut costs, including work requirements for able-bodied adults with children 7 years old or older. It would also undo a number of Biden-era provisions such as certain waivers related to work requirements.