Senate Republicans Unveil 420 Billion Dollar Tax Reform Bill, SALT Cap Raised to 40,000 Dollars

The United States Senate Republicans have unveiled a revised version of the tax reform bill, amounting to 420 billion dollars in tax cuts and spending reductions. This new proposal, which reflects internal compromises, is expected to be voted on soon, with the deadline approaching on July 4th. The bill addresses key areas such as the reduction in medical subsidies and the phase-out of tax credits for renewable energy.

The Republican Party has reached a preliminary agreement on the state and local tax deduction (SALT) cap, which has prompted the President to urge Congress to expedite the voting process on the tax reform bill. The President emphasized the urgency, stating that the House must be prepared to send the bill to his desk by July 4th. This stance contrasts with his earlier remarks, where he indicated that a slight delay beyond July 4th would be acceptable if negotiations required more time.

The preliminary agreement on SALT includes raising the annual cap on state and local tax deductions to 40,000 dollars for a period of five years. Senators have tentatively planned to begin voting on the bill around noon on Saturday. Despite the optimism surrounding the tax reform bill, the House Speaker has expressed doubts about its passage by July 4th. While the Speaker and the Treasury Secretary believe that a compromise on the SALT cap is imminent, they acknowledge that the legislative process may not be completed in time for the July 4th deadline. The President has set July 4th as a critical date for the bill's passage, adding pressure on lawmakers to finalize the legislation swiftly.

Currently, it is unclear whether all 50 Senate Republicans will support the bill. If necessary, the bill can be further modified in the Senate to ensure it secures the required votes. If the House Speaker encounters difficulties in garnering support for the bill, the House may make additional modifications. The Senate Republicans' new tax reform bill reflects a series of compromises within the party, addressing contentious issues such as the reduction in medical subsidies and the phase-out of tax credits for renewable energy. The bill includes a temporary agreement to raise the SALT cap to 40,000 dollars annually for five years, which is a key concession to address internal party disagreements. The Senate plans to begin voting on the bill as early as noon on Saturday, with the final vote potentially occurring by Sunday morning. Party leaders aim to convene the House of Representatives early next week to finalize the bill's approval, ensuring it meets the President's July 4th deadline. However, the support of all 50 Senate Republicans is not guaranteed, and further modifications may be necessary to secure the required votes. If the House Speaker faces challenges in gaining support, additional changes may be made in the House.