House Passes Senate Reconciliation Bill to Tee Up Tax Legislation
April 15, 2025
On April 10, the House of Representatives advanced the Senate’s budget framework (click here for our previous coverage) to officially begin legislative work on President Donald Trump’s “big, beautiful bill.”
Why it matters: The reconciliation bill will include
- Tax provisions,
- New spending on defense, energy, immigration;
- Spending cuts, and
- Raising the debt ceiling by $5 trillion.
What they’re saying: House GOP leaders had originally intended to vote on the bill Wednesday, but deficit hawks and the House Freedom Caucus holdouts were threatening to vote against the resolution due to concerns the Senate language did not guarantee enough spending cuts.
- The budget resolution passed 216 to 214 with two Republicans—Thomas Massie (R-KY) and Victoria Spartz (R-IN) — joining Democrats in voting against the measure.
- President Trump, Speaker Mike Johnson (R-LA), and Senate Majority Leader John Thune (R-SD) met with holdouts to assure them of the leadership’s commitment to cut spending. The Senate version only mandated $4 billion in cuts whereas the original House bill had $1.5 trillion in cuts.
- Speaker Johnson also promised House Budget Chairman Jodey Arrington (R-TX) that the final bill would not raise the deficit. Both understood that promise could be fulfilled by counting additional revenue through economic growth, rather than just spending cuts.
Yes, but: The budget resolution is the easy part for congressional leaders. Now, lawmakers will have to fill in the blanks on tax policy and any spending cuts, and the thin margins have proven difficult to navigate.
- Republicans can only lose four GOP senators in the 53 to 47 chamber.
- Sen. Rand Paul (R-KY) opposes the bill because it raises the debt ceiling.
- At least three GOP senators — Susan Collins (R-ME), Josh Hawley (R-MO), and Lisa Murkowski (R-AK) — are strongly opposed to Medicaid cuts. Democrats have pointed to the House budget as an attempt to slash at least $800 billion from the program.
- Four Republican senators — Lisa Murkowski (R-AK), John Curtis (R-UT), Thom Tillis (R-NC), and Jerry Moran (R-KS) — stressed the importance of maintaining a stable and predictable tax framework to promote domestic energy development.
- In a letter to Leader Thune last week, the four senators urged leaders to consider Inflation Reduction Act (IRA) tax credits on their merits rather than indiscriminately slashing them.
It will be difficult to cobble together $1.5 to $2 trillion in spending cuts without touching entitlement programs like Medicaid or popular programs like defense. At the end of the day, House spending hardliners may be faced with a choice: block President Trump’s first major legislative victory or swallow fewer spending cuts.
The bottom line: Congressional GOP leaders hope to wrap up the reconciliation bill by Memorial Day 2025, though Treasury Secretary Scott Bessent is hopeful that it could be completed by summer. As lawmakers begin to add detail to the policy, political horse-trading and redlines will chart a narrow path to enactment.
Contact
David McCarthy (
dmccarthy@crefc.org) with any questions.