House Passes Massive Tax and Spending Bill

Written by Michael Berson

After pulling an all-nighter last night, House Republicans passed (215-214) their massive (over 1,000 pages long) tax-and-spending reconciliation bill, which includes most of President Trump’s legislative agenda. The package now goes to the Senate where several of the provisions included are expected to be either stripped or significantly watered down, which means that Trump’s legislative goals would be subject to another vote in each chamber. The bill was opposed by Republican Reps. Thomas Massie (R-KY) and Warren Davidson (R-OH), and all Democrats. Rep. Andy Harris (R-MD) voted present.

The passage of this bill marks a major victory for Speaker Mike Johnson (R-LA), who has spent weeks wrangling blue-state moderates and frustrated conservatives to pass the measure before his self-imposed deadline of Memorial Day. In order to make a deal, Johnson agreed to (and included in a Manager’s Amendment) an increased state-and-local tax deduction, an accelerated start to new Medicaid work requirements, and a faster phase-out of clean energy tax credits. The latest version of the Manager’s Amendment also makes other changes, including:

• Elimination of a provision in the original reconciliation bill’s text that would have calculated federal employee’s retirement payments based on their highest five years of income, rather than the current calculation based on the highest three years of income.
• Removing suppressors from the National Firearms Act, a significant win for conservatives who pushed for the total repeal of the accessory from the law rather than the bill’s original elimination of just the $200 tax stamp on suppressors.
• Language that would have sold public lands in Nevada and Utah was removed after internal pushback from some House Republicans.

After House passage, the Republican balancing act now shifts to the Senate, which will have its say as it works to get the massive reconciliation package closer to becoming law. For example, GOP Senators have their own demands and Senate Majority Leader Thune (R-SD) will have to navigate the chamber’s complex rules (i.e. Byrd Rule), a historically time-consuming process. The Byrd Rule, which is named after the late Senator Robert Byrd (D-WV) who was known for his mastery of parliamentary procedure, prevents lawmakers from tucking non-budgetary provisions into the legislation.

Under normal practice, the Senate parliamentarian makes the call on challenges against provisions in the bill and whether they survive the “Byrd Bath.” Democrats plan to aggressively use the rule to challenge items they believe don’t satisfy the Byrd standard. Once the package makes it to the floor, senators will be prepared for a marathon vote-a-rama on amendments.

GOP senators hope the advance work will help keep the measure moving, but a look at the history of the chamber’s experience with big bills shows it will likely be a lengthy process. For the reconciliation bills enacted since 1980, the time between adoption of a budget resolution and enactment of the reconciliation bill ranges from 28 to 385 days, with a 152-day average, according to the Congressional Research Service. The Senate passed the Democrats’ 2022 sweeping reconciliation legislation with changes roughly nine months after the House passed it.

Regarding next steps, if the Senate amends the reconciliation legislation, the House would need to vote on the amended legislation or they would need to be reconciled in a conference committee. That’s likely to lead to more challenges, given the tight margins in the House.