Trump’s tax cut bill clears key House committee vote

Monday 19 May 2025 - 08:31

By: Zahouani Ilham

Trump’s tax cut bill clears key House committee vote

President Donald Trump’s comprehensive tax cut proposal has successfully passed a critical vote in a House committee, moving closer to a potential vote in the full House of Representatives later this week.

This unusual Sunday night decision represents a significant victory for Trump and House Speaker Mike Johnson. It followed a Friday impasse where conservative Republicans in the House Budget Committee blocked the bill due to disagreements over Medicaid spending cuts and the removal of green energy tax incentives.

Four conservative Republicans on the committee chose to vote “present,” allowing the bill to pass narrowly with a 17-16 vote. All Democrats opposed the measure.

Negotiations took place behind closed doors for much of the day between hardliners, House leaders, and White House officials. Johnson described the agreed changes as minor adjustments.

House Budget Chairman Jodey Arrington expects discussions to continue into the week before the bill is formally presented to the House.

Independent analysts warn that extending the 2017 tax cuts could increase the national debt by $3 to $5 trillion over ten years, adding to the current $36.2 trillion debt. Moody’s downgraded the US credit rating partly due to rising debt, projecting it could reach 134% of GDP by 2035.

Treasury Secretary Scott Bessent argued that economic growth from the bill would offset debt increases and downplayed Moody’s downgrade.

Experts caution that the downgrade, following similar decisions by Fitch and S&P, signals the need for lawmakers to either raise revenue or reduce spending.

The Republican majority in the House (220-213) remains divided over the extent of spending cuts needed to fund the tax reductions. Hardliners push for Medicaid cuts, despite opposition from some Republican senators concerned about voter backlash ahead of the 2026 elections.

The bill would remove 8.6 million people from Medicaid coverage, eliminate taxes on tips and some overtime income—key promises from Trump’s campaign—and increase defense and border security funding.

Democratic Senator Chris Murphy warned the credit downgrade could lead the US toward recession, criticizing the current economic management as reckless.