Trump backs $4.5T tax cut in House GOP budget plan

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The U.S. Capitol in Washington, D.C.
Al Drago/Bloomberg

President Donald Trump backed a House budget plan calling for a $4.5 trillion tax cut, slapping back Senate Republicans' efforts to rush through funds to help bolster his immigration crackdown in favor of a larger bill that will likely take months to negotiate.

Trump intervened in the ongoing budget conflict between House and Senate Republicans with a social media post Wednesday just before a key congressional vote.

The Senate plans to vote this week on a budget that would add $150 billion to military spending and increase immigration and border enforcement by $175 billion. Senate Republicans say they prefer to act on those priorities quickly and wait to resolve contentious disputes over tax cuts and the raising the debt ceiling. 

Trump instead endorsed a more sweeping House budget plan that raises internecine Republican conflicts over how much to cut federal spending and how large a tax cut should be.

"We need both Chambers to pass the House Budget to 'kickstart' the Reconciliation process, and move all of our priorities to the concept of, "ONE BIG BEAUTIFUL BILL," he said.

Trump's statement complicates Senate Republicans' efforts to muster support for a planned budget vote this week.

Senate Republican leader John Thune said the president's late intervention took him by surprise but he planned to proceed with the scheduled budget vote.

"I did not see that one coming," Thune said of Trump's statement. 

Trump's public declaration could help Speaker Mike Johnson gather the votes he needs to pass the budget. Some fiscal conservatives are holding out for deeper spending cuts while some GOP moderates in the House are already expressing reservations about the size of the cuts likely to be directed to Medicaid. 

"House Republicans are working to deliver President Trump's FULL agenda - not just a small part of it," Johnson said on X in response to Trump's comments.

The House is on a one-week break for the President's Day holiday and Republican leaders are struggling to come up with enough votes for the budget plan because of the party's narrow majority in the House. The House is planning to hold its budget votes next week, according to a person familiar with the plan.

Adopting the budget is the first step in a special process Republicans intend to use to bypass minority Senate Democrats on tax and spending legislation. A budget plan would allow Republicans to overcome procedural obstacles in the Senate with a simple majority rather than the 60 votes it would otherwise take. 

The House has drafted a plan to allow $4.5 trillion in tax cuts in exchange for $2 trillion in spending cuts and a $4 trillion increase in the debt ceiling. The House plan would direct $300 billion to military and border spending but the larger bill is expected to take months to hash out.

The House plans to extend individual and business tax breaks enacted in 2017 that are set to expire at the end of this year. It is also looking to increase the $10,000 limit on the state and local tax deduction, and end taxes on tips and Social Security benefits as called for by President Trump. But the cost of doing all those items for a full decade exceeds $4.5 trillion so lawmakers would either need to find deeper spending cuts or have them expire sooner.

That plan was approved in committee ahead of possible floor votes later this month. House leaders say their tiny majority means it is much easier to pass one bill rather than breaking it into pieces.

Bloomberg News
Tax Tax cuts Donald Trump Trump tax plan Tax extenders
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