Conservatives block Trump’s big tax breaks and spending cuts bill in a stunning setback

WASHINGTON (AP) — In a massive setback, House Republicans failed Friday to push their big package of tax breaks and spending cuts through the Budget Committee, as a handful of conservatives joined all Democrats in a stunning vote against it.

The hard-right lawmakers are insisting on steeper spending cuts to Medicaid and the Biden-era green energy tax breaks, among other changes, before they will give their support to President Donald Trump’s “beautiful” bill. They warn the tax cuts alone would pile onto the nation’s $36 trillion debt.

The failed vote, 16-21, stalls, for now, House Speaker Mike Johnson’s push to have the package approved next week. But the holdout lawmakers vowed to stay all weekend to negotiate changes as the Republican president is returning to Washington from the Middle East.

“Something needs to change or you’re not going to get my support,” said Rep. Chip Roy, R-Texas.

Tallying a whopping 1,116 pages, steeper cuts to Medicaid and other programs to help offset the costs of the tax breaks. But at the same time, lawmakers from high-tax states including New York are demanding a deeper tax deduction, known as SALT, for their constituents.

Johnson has insisted Republicans are on track to pass the bill, which he believes will inject a dose of stability into a wavering economy.

Democrats slammed the package, but they will be powerless to stop it if Republicans ultimately unite. They emphasized that millions of people would lose their health coverage if the bill passes while the wealthiest Americans would reap enormous tax cuts. They also said it would increase future deficits.

“That is bad economics. It is unconscionable,” said Rep. Brendan Boyle, the top Democratic lawmaker on the panel.

The Budget panel is one of the final stops before the package is sent to the full House floor for a vote, which is expected as soon as next week. Typically, the job of the Budget Committee is more administrative as it compiles the work of 11 committees that drew up various parts of the big bill.

But Friday’s meeting proved momentous. Republicans hold a slim majority in the House and have just a few votes to spare to advance the measure, including on the Budget Committee.

Four Republican conservatives initially voted against the package — Roy and Reps. Ralph Norman of South Carolina, Josh Brecheen of Oklahoma, Rep. Andrew Clyde of Georgia. Then one, Rep. Lloyd Smucker of Pennsylvania switched his vote to no.

The conservative holdouts from the Freedom Caucus are insisting on deeper cuts — particularly to Medicaid. They want new work requirements for aid recipients to start immediately, rather than on Jan. 1, 2029, as the package proposes.

Roy complained that the legislation front-loads new tax cuts and spending while backloading the savings.

“We are writing checks we cannot cash, and our children are going to pay the price,” Roy said.

“Sadly,” added Rep. Ralph Norman, R-S.C., “I’m a hard no until we get this ironed out.”

At the same time, the New Yorkers have been unrelenting in their demand for a much larger SALT deduction than what is proposed in the bill, which could send the overall cost of the package skyrocketing.

As it stands, the bill proposes tripling what’s currently a $10,000 cap on the state and local tax deduction, increasing it to $30,000 for joint filers with incomes up to $400,000 a year.

Rep. Nick LaLota, one of the New York lawmakers leading the SALT effort, said they have proposed a deduction of $62,000 for single filers and $124,000 for joint filers.

The conservatives and the New Yorkers are at odds, each jockeying for their priorities as Johnson labors to keep the package on track to pass the House by Memorial Day and then onto the Senate.

“This is always what happens when you have a big bill like this,” said Majority Leader Steve Scalise, R-La. “There’s always final details to work out all the way up until the last minute. So we’re going to keep working. There’s a lot of work to be done.”

At its core, the sprawling package extends the existing income tax cuts that were approved during Trump’s first term, in 2017, and adds new ones that the president campaigned on in 2024, including no taxes on tips, overtime pay and some auto loans.

It increases some tax breaks for middle-income earners, including a bolstered standard deduction of $32,000 for joint filers and a temporary $500 boost to the child tax credit, bringing it to $2,500.

It also provides an infusion of $350 billion for Trump’s deportation agenda and to bolster the Pentagon.

To offset more than $5 million in lost revenue, the package proposes rolling back other tax breaks, namely the green energy tax credits approved as part of President Joe Biden’s Inflation Reduction Act. Some conservatives want those to end immediately.

The package also seeks to cover the costs by slashing more than $1 trillion from health care and food assistance programs over the course of a decade, in part by imposing work requirements on able-bodied adults.

Certain Medicaid recipients would need to engage in 80 hours a month of work or other community options to receive health care. Older Americans receiving food aid through the Supplemental Nutrition Assistance Program, known as SNAP, would also see the program’s current work requirement for able-bodied participants without dependents extended to include those ages 55-64. States would also be required to shoulder a greater share of the program’s cost.

The nonpartisan Congressional Budget Office estimates at least 7.6 million fewer people with health insurance and about 3 million a month fewer SNAP recipients with the changes.

Mocking the name of the bill, Rep. Pramila Jayapal, D-Wash., called it “one big, beautiful betrayal.”

“To pay for it,” Democratic Rep. Morgan McGarvey said, “kids in Kentucky will go hungry, nursing homes and hospitals will close, and millions of Americans will be kicked off their health insurance. It’s wrong.”

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Associated Press writer Leah Askarinam contributed to this report.