(Bloomberg) — Senate Republicans intend to propose revised tax and health-care provisions to President Donald Trump’s $3 trillion signature economic package this week, shrugging off condemnations of the legislation by Elon Musk as they rush to enact it before July 4. Most Read from Bloomberg The Senate Finance Committee’s plan to extract savings from the Medicaid and — perhaps — Medicare health insurance programs could depart in key respects from the version of the giant bill that narrowly passed the US House in May. The release of the panel’s draft will likely touch off a new round of wrangling between fiscal conservatives and moderates.
Businesses in the energy, health care, manufacturing and financial services industries will be watching closely as the week progresses. Key members of Congress and Trump officials charged with shepherding the tax bill are slated to meet on Thursday to discuss the bill, according to a White House official. House Speaker Mike Johnson told reporters at the White House on Monday he believes the Senate can meet the Fourth of July deadline, despite the truncated period for negotiations.
He added that Majority Leader John Thune is also “optimistic” about that timeline. SALT Dilemma A crucial decision for Thune, Finance Committee Chairman Mike Crapo and other panel members will be how to handle the $40,000 limit on state and local tax deductions that was crucial to passage of the bill in the House. Senate Republicans want to scale back the $350 billion cost of increasing the cap from $10,000 to $40,000 for those making less than $500,000.
Johnson and a group of Republican members from high-tax states have warned that any diminishing of the SALT cap would doom the measure when it comes back to the House for a final vote. At the same time, so-called pass-through businesses in the service sector are pushing to remove a provision in the House bill that limits their ability to claim SALT deductions. The Senate Finance Committee is widely expected to propose extending three business tax breaks that expire after 2029 in the House version to order to make them permanent.
They are the research and development deduction, the ability to use depreciation and amortization as the basis for interest expensing and 100% bonus depreciation of certain property, including most machinery and factories.
