Senate Advances Contentious Trump Tax-and-Spending Megabill

The Senate’s 940-page “big, beautiful bill” advances several Trump priorities but faces uncertain House approval and tight Senate vote math, especially over a proposed $5 trillion debt ceiling increase. Key provisions: - Taxes: Extends major elements of the 2017 tax cuts (lower brackets, higher standard deduction, larger child tax credit). Adds temporary (2025–2028) tax breaks for tip income, overtime, auto loans, and a bonus deduction for older Americans to offset Social Security taxes. Benefits skew toward higher-income households per the Tax Policy Center. - Revenge tax dropped: Section 899, a retaliatory tax on countries with “discriminatory” taxes, was removed after Wall Street pushback and a G7 “joint understanding” pledge. - SALT cap: Raises the deduction cap to $40,000 starting in 2025, phasing out after $500,000 income; both indexed 1% annually through 2029, reverting to $10,000 in 2030. Preserves the pass-through SALT workaround, drawing criticism for favoring wealthier taxpayers. - Medicaid: Some cuts were struck by the parliamentarian, but 80-hour-per-month work requirements remain, potentially affecting millions’ coverage per CBO. - EVs: Eliminates the $7,500 electric vehicle tax credit for sales and leases effective Sept. 30, earlier than previously proposed. - Targeted carve-outs: Includes niche benefits like raising the whale-hunting expense deduction (a win for Alaska). Next steps: Senate Majority Leader John Thune seeks a procedural vote as soon as Saturday, but vote counts are uncertain; House acceptance before the GOP’s July 4 deadline is also in doubt.

CNN’s fact check says President Trump falsely claimed his sweeping domestic policy bill leaves Medicaid unchanged, eliminates taxes on Social Security benefits, and that taxes would rise 68% if it doesn’t pass. In reality, both the House-passed version and the Senate’s working version make major Medicaid changes, including work requirements and enrollment hurdles, and cut federal Medicaid funding by about $800 billion over a decade—CBO projects 7.8 million more uninsured by 2034. The bill does not end taxation of Social Security benefits; it temporarily increases seniors’ standard deduction ($4,000 in the House bill, $6,000 in the Senate draft), with phaseouts at higher incomes. There is no credible basis for a 68% tax hike absent the bill. The White House promoted the bill’s goals but did not defend Trump’s specific claims.

The Senate narrowly advanced President Trump’s sweeping tax-and-spending package, 51-49, moving it to debate with a possible final vote as soon as Monday, though its ultimate passage remains uncertain. The bill would cut federal taxes, boost Pentagon and border funding, and curb safety-net programs like Medicaid. Trump wants it signed by July 4, but differences with the House and unresolved GOP demands could slow it. Key holdouts—Sens. Rick Scott, Mike Lee, Ron Johnson, and Cynthia Lummis—were won over after intense lobbying by Senate leaders, Vice President JD Vance, and Trump, while Sens. Thom Tillis and Rand Paul voted no. Concessions included Alaska-specific provisions to secure Sen. Lisa Murkowski’s support. Democrats are delaying progress by forcing a full reading and a vote-a-rama. Fiscal conservatives are pushing amendments such as capping Medicaid expansion enrollment, and House GOP leaders urged members to avoid public criticism as negotiations continue.

Senate Republicans advanced a nearly 1,000-page tax and spending “megabill” that packages many of President Trump’s priorities, setting up a lengthy amendment process before a final vote and a tough path in the narrowly divided House. Key provisions include: - Taxes: Temporary deductions for tip income (up to $25,000) and overtime (up to $12,500) through 2028 with income phaseouts above $150,000; child tax credit increased to $2,200 with inflation adjustments after 2025; permanent expansion of the standard deduction (Senate only); larger seniors’ deduction to $6,000 through 2028 with phaseouts above $75,000; overall extension of Trump-era tax cuts totaling about $4 trillion. - Debt ceiling: Raises the limit by $5 trillion (more than the House’s $4 trillion) to avert default risk expected between mid-August and end of September absent action. - SNAP: Expands work requirements for able-bodied adults up to age 64 starting in 2028; limits state waivers; shifts more costs to states based on error rates. - SALT: Temporarily lifts the $10,000 cap to $40,000 for married filers with incomes up to $500,000 through 2028, aimed at aiding members from high-tax states. - Medicaid: Imposes 80-hours-per-month work requirements for able-bodied adults up to age 65 with exemptions for parents of children under 14 and disabled individuals; phases down provider taxes to a 3.5% cap starting in 2028; adds a $25 billion, five-year fund for rural hospitals beginning in 2028. The bill passed its initial Senate hurdle 51–49, with internal GOP divisions persisting over Medicaid changes and the debt limit. A full bill reading, limited debate time, and a vote-a-rama of amendments will precede a final vote. The House remains a major obstacle due to razor-thin margins and SALT-driven holdouts.

Republicans are advancing a sweeping domestic policy package aligned with Trump’s agenda, featuring major tax cuts, increased military and immigration spending, and deep reductions to safety-net programs. The House has passed its version; the Senate released a draft with notable differences that must be reconciled. Key tax provisions: - Standard deduction: House adds $1,000 ($2,000 couples) for 2025–2028; Senate grants a one-time permanent $750 ($1,500 couples) boost in 2025. - Child tax credit: House to $2,500 (2025–2028) with both parents needing SSNs; Senate to $2,200 permanently from 2026, only one parent needs an SSN. Neither changes income phase-ins that limit low-income access. - Estate tax: Both permanently keep the higher exemption (~$14M), rising with inflation to $15M in 2026 ($30M couples). - SALT cap: Both raise to $40,000 with phase-down for high earners; Senate reverts to $10,000 in 2030. - Pass-through deduction: House boosts to 23%; Senate keeps at 20%. - Corporate expensing/R&D: House through 2029; Senate makes permanent. New policies: - Senior add-on to the standard deduction (2025–2028): House $4,000; Senate $6,000, phasing down above $75,000 income ($150,000 couples). - No tax on tips (2025–2028): House uncapped below $160,000 income; Senate caps at $25,000 with a phaseout above $150,000 ($300,000 couples). - No tax on overtime (2025–2028): House uncapped below $160,000; Senate caps at $12,500 ($25,000 couples) with similar phaseouts. - Car loan interest deduction: Both allow up to $10,000; House requires U.S. final assembly and phases down above $100,000 income ($200,000 couples); Senate also requires the car be new. - “Trump account”: $1,000 at birth (2024–2028) in a new tax-advantaged account (both chambers). - University endowment tax: House up to 21%; Senate up to 8%. - Charitable deduction for non-itemizers: House up to $150 ($300 couples) for 2025–2028; Senate up to $1,000 ($2,000 couples) starting 2026, permanent. Offsets via safety-net cuts: - Medicaid: Both impose work requirements and more frequent eligibility checks; Senate extends requirements to more parents compared to House. - Food assistance and other social programs face significant reductions. Overall, both bills extend and expand 2017-era tax cuts, add targeted new cuts (especially for seniors, tips, and overtime), favor permanent corporate incentives in the Senate, and finance the package with sizable cuts to Medicaid and other aid, with the Senate generally opting for more permanence and tighter caps.

The Senate narrowly voted 51–49 to begin debating a sweeping Republican policy bill advancing President Trump’s agenda, after GOP leaders struck last-minute deals with holdouts. Two Republicans, Thom Tillis and Rand Paul, joined Democrats in opposing the motion, though several hard-right senators flipped to yes after securing deeper spending-cut commitments. Passage remains uncertain as Democrats forced a lengthy bill reading that could push a final vote to Monday, ahead of Trump’s July 4 deadline. The 940-page bill extends and adds Trump-backed tax cuts while making major reductions to safety-net programs, including Medicaid and SNAP, likely increasing federal debt by over $3 trillion in a decade pending CBO scoring. To win votes, Republicans added a $25 billion fund for rural hospitals, delayed a Medicaid financing crackdown by a year, accelerated cuts to renewable-energy tax credits, and raised the state and local tax deduction cap to $40,000 for five years. Alaska-specific exemptions and benefits were included to address Senator Lisa Murkowski’s concerns. Tillis warned the bill would harm North Carolina’s hospitals and Medicaid coverage; Trump publicly attacked him for opposing it. Despite reservations, some skeptics like Josh Hawley signaled support, while fiscal hawks and moderates remain divided over deficit impact and health-care cuts.

Republicans’ proposed Medicaid work requirement would force 42 states and D.C. to rapidly build complex eligibility and tracking systems despite outdated infrastructure and reduced federal funding, risking Healthcare.gov-style failures. State officials and experts warn of website glitches, incorrect denials, overwhelmed call centers, and coverage losses for eligible people, including groups beyond the targeted working-age adults. Implementation depends on late federal guidance and costly data from private vendors, with tight timelines pushing states into pricey no-bid contracts; prior attempts cost tens to hundreds of millions, while the bill provides only $200 million nationally. Real-world examples in Arkansas and Georgia show low awareness, flawed reporting systems, and significant coverage losses or under-enrollment. While C.M.S. says technology exists and some former officials argue the timeline is feasible, many foresee widespread administrative strain, delays, and errors without more time and resources.