House GOP holdouts threaten revolt over Trump and Senate’s tax bill

As Senate Republicans eye the finish line on President Donald Trump’s massive tax and immigration proposal, there may be one more obstacle standing in the way of what they hope to be era-defining legislation: their GOP colleagues in the House.

The Senate has transformed key provisions from the House-passed version of Trump’s One Big Beautiful Bill Act, a measure that would extend trillions of dollars in tax cuts, spend hundreds of billions on immigration enforcement and defense, and cut spending on social benefit and anti-poverty programs.

Now to many House Republicans, the legislation looks unrecognizable – and no longer adheres to hard-fought compromises lawmakers in the lower chamber secured just a month ago.

That task got harder Wednesday night and early Thursday. The GOP may not include many of its initial proposals to jettison immigrants from Medicaid, the Senate parliamentarian ruled, blowing a nearly $250 billion hole into the bill’s budget math.

The Senate hoped to include deeper funding cuts to Medicaid than the House bill would make, including a provision that some lawmakers fear would threaten rural hospitals in their states. But the parliamentarian said that and other measures violate rules surrounding budget reconciliation, the process Republicans are using to bypass a Democratic Senate filibuster.

Other Senate proposals are more costly than what the House approved. The upper chamber would preserve, for now, some Biden-era clean energy credits the House sought to eliminate immediately. And House and Senate Republicans are still negotiating a compromise over raising the limit on how much taxpayers can deduct in state and local taxes – a crucial issue for a handful of House Republicans in high-tax states who have threatened to vote against the bill if they don’t get their way.

House budget hard-liners nearly tanked the legislation in May over concerns it added too much to the national debt; the Senate’s bill is likely dramatically more expensive.

Senate Majority Leader John Thune (R-South Dakota) is rushing his chamber into a vote on the measure by the end of the week, trying to beat a self-imposed Independence Day deadline to have the bill on Trump’s desk.

“The day I sign this bill into law, almost every major promise made in the 2024 campaign already will have become a promise kept,” Trump told a crowd at the White House on Thursday at an event to build support for the legislation.

Senate Republicans are trying to draft a bill that the House can pass and send to Trump’s desk without further changes. Thune spoke with House Speaker Mike Johnson (R-Louisiana) several times Wednesday to talk through “various aspects of the Senate bill and what the prospects are when it gets to the House,” Thune said on “The Hugh Hewitt Show.”

But at least for now, lawmakers in the lower chamber don’t appear ready to pass the bill the Senate is drafting.

“Our red line hasn’t changed,” Rep. Andy Harris (R-Maryland), chair of the archconservative House Freedom Caucus, told The Washington Post. “It has to conform to the House framework, and it doesn’t.”

Rep. Ralph Norman (R-South Carolina), a leading deficit hawk on the powerful Rules Committee, called the Senate’s proposal “a nonstarter.”

“We’re not going to get jammed on this. We’re just not. There’s no reasonable argument of budging off what we sent over there,” he said. “I had a hard time with that because we could do so much more. But this is our moment. If we fail to seize it, it’s on us.”

But those holdouts have been through this saga before – and folded.

The budget reconciliation process requires both chambers to approve a budget resolution with broad policy outlines for the bill, then to pass the legislation itself.

Would-be GOP rebels voiced similar concerns when the House took up a budget resolution in February, then again in April on an amended budget and finally in May on the tax legislation itself. Each time, they ultimately voted for the measure despite initial protests.

“They got half-pregnant on the first budget resolution, then they got three-quarters pregnant when they voted for this, and they’re about to get fully pregnant. The whole time, they’ve been pregnant,” said Rep. Thomas Massie (Kentucky), the only House Republican who has voted against all three pieces of legislation. “They’re going to vote for whatever’s put in front of them, and that’s always been the case.”

The biggest hurdle for the House may be the legislation’s price tag. The Congressional Budget Office found the House-passed legislation would add $3.3 trillion to the national debt over 10 years, when factoring in interest costs and effects on the wider economy.

The Senate’s version could add far more. The upper chamber’s tax provisions are hundreds of billions of dollars more expensive, according to the Joint Committee on Taxation, and several proposals lawmakers had hoped to use to cut spending and trim the overall cost have been ruled out of order by the Senate’s parliamentarian, who can approve or reject provisions because of the budget reconciliation process.

To offset the tax cuts, the House version would rapidly wind down clean energy credits from former president Joe Biden’s 2022 Inflation Reduction Act. The Senate would temporarily preserve those programs, including incentives for hydropower, nuclear and geothermal energy firms for nearly a decade.

A band of blue state Republicans in the House struck a deal with Speaker Johnson to raise the cap on the state and local tax deduction, or SALT. That allows itemizing filers to write off what they paid in local taxes from their federal tax return.

The House would raise the cap to $40,000 for taxpayers earning no more than $500,000. The Senate did away with the deal entirely, leaving the deduction untouched at $10,000 – an amount set by Republicans in 2017 to reduce the cost of Trump’s Tax Cuts and Jobs Act.

House Republican moderates often cave and vote for bills they initially wavered on, in an effort to project party unity. Many voted for the House version, despite concerns over the Medicaid provisions and repealing the clean energy tax credits. At the time, the moderates hoped the Senate would soften the House version.

Instead, particularly on Medicaid, the Senate is expected to go further in its reductions – making their bill less palatable for a group that argues they helped win the GOP House majority.

The Senate would limit taxes that states charge medical providers as a roundabout way of collecting more federal Medicaid dollars. That has some lawmakers particularly concerned about rural hospitals, which rely heavily on Medicaid patients.

A group of 16 House Republicans from blue states or swing districts wrote to Thune and Johnson on Tuesday to say the Senate’s proposal “undermines” the House’s approach and treated different states “unfairly.”

“These changes would place additional burdens on hospitals already stretched thin by legal and moral obligations to provide care,” the group wrote.

A few Republican senators have sounded similar alarms. Sen. Susan Collins (R-Maine) is pushing to include a $100 billion fund in the bill to soften the impact of Medicaid cuts on rural hospitals – but she said even that might not be enough.

“The Senate cuts in Medicaid are far deeper than the House cuts, and I think that’s problematic as well,” Collins told reporters Wednesday.

Other Senate Republicans brushed aside House Republicans’ complaints about the changes.

Sen. Roger Marshall (R-Kansas), who served two terms in the House before his election to the Senate, said he was skeptical House lawmakers would reject a bill that extended tax cuts and increased defense and border spending, among other GOP priorities.

“There are so many great things in this bill, I think it’s going to be hard for the House to vote against it,” Marshall told reporters. “You’re not going to get everything you want.”

Sen. Josh Hawley (R-Missouri) has invoked Trump’s role in negotiating the House bill to argue against Medicaid cuts that could hurt rural hospitals – and spoil delicate negotiations with the House.

“I don’t think this is the time to play a game of chicken,” he said.