President Trump’s “Big, Beautiful Bill” is still on track and working through Congress. As it makes its way, conservatives are working to ensure that greater spending reductions and common-sense social safety-net reforms are included. 

Yesterday, the House Budget Committee passed the bill after a failed vote last week, with promises of proposals for new reforms to strengthen the bill. Several conservatives who previously voted against the bill agreed to greenlight it from the committee.

As we’ve reported, the tax and spend bill working through the reconciliation process would prevent a massive tax increase by making permanent the current lowered tax rates, the doubled Child Tax Credit, the nearly doubled standard deduction, and the small business tax credit. 

On top of that, this bill increases some of those widely used tax deductions as well as implements new working-class and middle-class benefits, such as eliminating taxes on overtime, tips, and car insurance payments. 

In addition, the bill makes critical energy reforms while rolling back some Biden green spending and strengthens our border security apparatus.

The bill’s next stop is the rules committee, followed by a vote by the full House of Representatives, reportedly this week.

Under Speaker Mike Johnson, Congress is working on an aggressive timeline of passing the bill by Memorial Day and sending it over to the Senate for consideration.

For an overview of the bill, click here.

These are the stakes if the bill is not enacted. 

How the One Big, Beautiful Bill Could Change

According to reports, during weekend negotiations, Speaker Johnson proposed

  • Speeding up the implementation of expanded Medicaid work requirements.
  • Nixing more green IRA subsidies.
  • Ending Medicaid for people living in the U.S. illegally. 

First, accelerating the implementation of expanded Medicaid work requirements to Dec. 31, 2026, would kick-start Medicaid reforms and savings. In the original bill, work requirements were set to kick in four years from now, in 2029. 

Work requirements are needed for Medicaid, as I explained in this recent Newsmax op-ed: 

Medicaid enrollment grew as eligibility verification for Medicaid was restricted during this time and people were encouraged to apply.

…

Some able-bodied adults do need healthcare support, and as Americans, we are willing to provide it with the expectation that they seek employment toward financial independence.

However, there is no federally mandated work requirement for the Medicaid program.

States that sought to implement work requirements faced pushback from the Biden administration. That must change.

With over 7 million available jobs, policymakers should encourage unemployed and labor force dropouts on Medicaid to find work as a condition to keep their benefits. Americans agree.

Medicaid reforms are a sticking point for some on the right, who either do not want reforms or want to delay their implementation for as long as possible.

However, by large margins, Americans want work requirements for Medicaid.

Additionally, Medicaid benefits would be revoked for undocumented immigrants.

Another reform that Speaker Johnson proposed is a phase-out of green energy tax credits by 2028. These green tax giveaways were enacted in 2022 as part of the non-inflation-reducing Inflation Reduction Act, and some are already in effect. IWF has joined many groups in supporting the scaling back of those IRA green subsidies. 

The bill continues to be renegotiated in ways that will strengthen it. These changes are not just important policy reforms, but they can help offset the costs of the bill.

Independent congressional analysis pegs the cost of the bill’s tax provisions as adding more than $4.8 trillion to the federal deficit over the coming decade. Medicaid reforms and ending IRA subsidies can partially offset that.

According to Rep. Jay Obernolte (R., Calif.), a Budget Committee member, the Republican plan would be good for the nation’s fiscal future, noting, 

If you have to pick between a higher-tax, higher-spending regime and a lower-tax, lower-spending regime, the latter is always better for economic growth.

What’s Next

Negotiations on this bill will continue. The House Freedom Caucus, which has pushed for greater spending cuts and Medicaid reforms, tweeted

The thread continued:

Thanks to discussions over the weekend, the bill will be closer to the budget resolution framework we agreed upon in the House in April, but it fails to actually honor our promise to significantly correct the spending trajectory of the federal government and lead our nation towards a balanced budget. 

We are determined and committed to working through the remaining obstacles within this bill.

These aren’t the only concerns some conservatives have with the bill. Another faction representing blue states wants the proposed State and Local Tax (SALT) deduction raised. The current bill proposes a $30,000 cap, but those high-tax state representatives say that’s not high enough. 

Bottom Line

The tax bill continues to be refined and tweaked. Most critically, it keeps taxes low and will lower them even further.