Senate Republicans Unveil Their Version Of Trump's Tax And Medicaid Cuts

WASHINGTON — Senate Republicans on Monday unveiled a draft of their vision for key tax and spending cuts, setting up an intra-party conflict over legislation enacting President Donald Trump’s agenda.

The new text from the Senate Finance Committee addresses tax and Medicaid policy, differing in small ways from the legislation that passed the House last month. Republicans in the two chambers will need to agree on identical bill text before the legislation can go to the White House for Trump’s signature.

House and Senate Republicans agree on the big picture: an extension of the temporary tax cuts Republicans enacted during Trump’s first term in 2017. Unless Congress takes action, those cuts will expire at the end of the year. The cost of those tax cuts would be partly offset by cuts to Medicaid and the Supplemental Nutrition Assistance Program.

“This bill prevents an over-$4 trillion tax hike and makes the successful 2017 Trump tax cuts permanent, enabling families and businesses to save and plan for the future,” Senate Finance Committee Chair Mike Crapo (R-Idaho) said in a release.

Though Republicans agree on the broad outlines of the so-called Big Beautiful Bill, with most of the savings coming through new limits on Medicaid eligibility for able-bodied adults, there will be several disagreements over the details.

One key difference in the text Crapo’s committee released Monday is that it would pare back a state strategy for funding Medicaid benefits through taxes on major Medicaid providers like hospitals and nursing homes. The House bill would freeze current provider tax rates, which can’t go above 6%, while the Senate bill would gradually lower the limit to 3.5%.

Sen. Josh Hawley (R-Mo.) has said he thought the House provision was too strict, and that it would harm rural hospitals in Missouri. The Senate proposal is even stricter than the House version.

“I’m very concerned about the effect on rural hospitals,” Hawley said last week. “What I’ve said to my leadership is — and this is what I talked to the president about — is that I don’t want to see rural hospitals close. So that’s my bottom line.”

Republicans control 53 Senate seats. Under the “budget reconciliation” process they’re following for their bill, they can get it through the Senate with a simple majority instead of the usual 60 votes. That means they can lose three Republicans and still pass the bill with Vice President JD Vance breaking a tie.

Another disagreement between House and Senate Republicans: a costly tax deduction for wealthy homeowners. House Republicans representing districts in blue states like New York pushed for quadrupling the deduction from $10,000 to $40,000. The Senate bill leaves it at $10,000, though negotiations will likely continue.

“Unless there’s at least $40,000 of SALT in the bill, it can’t pass the House,” Rep. Nick LaLota (R-N.Y.) told reporters last week.

Some Republicans in both the House and Senate have complained that the spending cuts are smaller than the tax cuts, meaning the bill would widen budget deficits and add more money to the national debt. It’s not clear if fiscal hawks would be willing to block the legislation, however.