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Fox News
a day ago
- Business
- Fox News
Conservative roadmap targets Medicaid, student loans for Trump's 'big, beautiful' sequel
FIRST ON FOX: A conservative think tank that played a key role in shaping President Donald Trump's "one big, beautiful bill" is circulating a new roadmap of recommendations for Republicans' second act. The Economic Policy Innovation Center, which styles itself as "EPIC For America," has been circulating a new memo with key congressional GOP figures in recent days, a source familiar with the group's plans told Fox News Digital. The memo, which was obtained by Fox News Digital, advises lawmakers to broadly push for further Medicaid and regulatory reforms, crack down on federal dollars for government pensions and student loans, and use fiscal policy to extend conservative goals on abortion and transgender treatment. Passing Trump's massive agenda bill despite razor-thin majorities in the House and Senate was a major victory for Republican leaders. EPIC, which hails the bill as a success, argues that continued reforms are needed for meaningful fiscal reform. "Unfortunately, even with the victories for the American people in the OBBB, our work is far from done. We must rebuild an economy that truly works for every American, while protecting the nation's financial foundation to ensure lasting resilience," the memo said. "The federal government is rapidly running out of fiscal space. Maintaining sufficient fiscal space is critical in order to respond appropriately to a crisis. Without space between the fiscal limit and the current level of debt, elected officials will not have room to maneuver in the event of war, a natural disaster, or a recession." On Medicaid, the memo advises further cuts to the cost-sharing burden on the federal government – known as the Federal Medical Assistance Percentage (FMAP) – for "large, wealthy states" as well as Washington, D.C. FMAP refers to the rate at which the federal government matches state Medicaid payments, which is currently 50%. The memo calls to "end the special Medicaid subsidy FMAP treatment" for D.C., whose minimum is 70%. Republicans' first budget reconciliation bill reduced certain FMAP expansions permitted under the Affordable Care Act (ACA), including for emergency care for states that provide Medicaid coverage to illegal immigrants. In turn, EPIC advises lawmakers to enhance personal and employer-based healthcare, like Individual Coverage Health Reimbursement Arrangements (ICHRAs) and Health Savings Accounts (HSAs). Medicaid cuts were one of the largest sticking points during talks for the initial bill and will likely be just as politically fraught for Republicans in the second round. Meanwhile, Democrats have been using those reforms as a political cudgel, accusing the GOP of trying to take healthcare from millions of Americans. But conservatives have viewed Medicaid as fraught with waste, fraud, and abuse – insisting their reforms better protect the program for vulnerable people who truly need it. The memo also advises congressional Republicans to use the budget reconciliation process to "reform federal bureaucrat compensation and retirement" and "eliminate public sector student loan forgiveness," among other goals. On the social conservative policy front, EPIC appears to view an extension of the ban on taxpayer funds to abortion providers as critical to a second reconciliation bill. The first bill was viewed as a victory for pro-life advocates in its ban on Medicaid funds for large healthcare providers that perform abortions, which would affect Planned Parenthood and other similar organizations. But that ban is only effective for a year. In a section titled "Protect Life and American Values," EPIC urges lawmakers to "extend the prohibition of taxpayer funding for big abortion providers" as well as block Medicaid funds for gender transition care. It also calls on lawmakers to "invest in election security" and "impose an excise tax on higher education institutions that allow males to participate in women's sports." EPIC was founded by Paul Winfree, who served as director of budget policy during the first Trump administration. The group also has close ties to Capitol Hill, which it flexed during talks for Trump's first agenda bill by both recommending policy initiatives and tailoring its advice through the various steps of the budget reconciliation process. Budget reconciliation, which can be used three times during a given congressional term, allows the party in power to enact broad fiscal policy changes while sidelining the opposition – in this case, Democrats – by lowering the Senate's threshold for passage from 60 votes to 51. Brittany Madni, EPIC executive vice president and a former congressional aide, confirmed the memo's veracity to Fox News Digital. She said the group would use the same "playbook" it did during the first reconciliation process. She said EPIC is looking to offer "an initial suggestion to lawmakers on what to target, and is readying to work with Republicans through the various steps of the process as details change and evolve." "Mandatory spending reform is an essential target for actual fiscal change in order to stave off a debt spiral. This is why a second reconciliation bill building on the wins in the OBBB is important," Madni said. Two sources told Fox News Digital that the group's efforts so far have included a staff-level briefing with the Republican Study Committee (RSC), a 189-member-strong House GOP group that serves as its own de facto think tank for the Republican conference. Many of the aforementioned proposals were discussed at that meeting, Fox News Digital was told, with EPIC being invited to speak as part of the RSC's new initiative to workshop a second reconciliation bill. House Speaker Mike Johnson, R-La., has already publicly stated his goal of passing further reconciliation bills. But what a second bill would look like is still unclear.
New York Times
02-07-2025
- Business
- New York Times
Tax Cuts Now, Benefit Cuts Later: The Timeline in the Republican Megabill
At the core of Republicans' sprawling domestic policy package is an important political calculation. It provides its most generous tax breaks early on and reserves some of its most painful benefit cuts until after the 2026 midterm elections. The result is a bill that, if it becomes law, may generate bigger refunds for some taxpayers when they file their returns next spring, even as a series of significant changes to Medicaid and other aid programs loom as a future threat to the finances of poorer families. For President Trump, the staggered timelines underscore the political risks in his signature legislation, which passed the Senate on Tuesday and now awaits a final vote in the House. To pay for the tax policies, which confer their greatest benefits on the wealthy, Republican lawmakers have looked to slash programs that are both popular and widely used, discomfiting even some within their own ranks. The savings from the safety net cuts still are not enough to offset an expensive package of tax breaks that is projected to add more than $3 trillion to the federal debt by 2034. Some of the proposals, including those that could see millions of people lose Medicaid and food stamps, are unlikely to be viewed favorably by voters. That reality led some Senate Republicans to oppose the domestic policy bill this week, citing the potential adverse impacts on their states and residents. Matthew D. Dickerson, the director of budget policy for the Economic Policy Innovation Center, a conservative group, said the timeline reflected a lesson that Republicans had learned in Mr. Trump's first term, when they passed a package of tax cuts in 2017. By The New York Times By The New York Times By The New York Times Want all of The Times? Subscribe.
Forbes
22-05-2025
- Business
- Forbes
5 Key Takeaways From The House's Passage Of The Big Beautiful Bill Act
By the thinnest of margins (215 to 214), the House of Representatives has voted to pass Trump's domestic policy bill. According to Forbes, the 'Big Beautiful Bill' act has trillions of dollars of impact on US taxpayers, including renewing the tax cuts from the Tax Cuts and Jobs Act of 2017, a deduction for income earned from tips, and increased deductions for state and local income taxation, and much more. However, the bill proposes to pay for these tax cuts by limiting the benefits from social services programs like Medicaid, food stamps, and student loan payment plans. In this article, I discuss five key takeaways from its passage and what it might mean for the US and taxpayers moving forward. Since the passage of the Tax Cuts and Jobs Act of 2017, many have circled this moment as an inflection point on the future of taxation in the US. The reason for this is because of the Byrd Rule, which, according to the Economic Policy Innovation Center, states that a reconciliation bill (not unlike the Tax Cuts and Jobs Act) cannot increase the deficit in years outside of the 10-year budget window. As the Tax Cuts and Jobs Act did, in fact, increase the deficit, the provisions from that bill could not be permanent. This rule put significant focus on the events this year, where Congress was forced to either allow the provisions to sunset or to pass new legislation to extend those provisions, or, in the case of the Big Beautiful Bill, make those provisions permanent. According to Forbes, the most significant tax provisions for individuals that will now be extended or made permanent include lower individual income tax rates, higher standard deductions, lower mortgage interest deductions, elimination of miscellaneous itemized deductions and moving expense deductions, and an increase in the child tax credit. For corporate taxpayers, the qualified business income deduction would be renewed and increased, foreign income provisions like GILTI, FDII, and BEAT would become permanent, bonus depreciation would be renewed through 2029, and R&D could be 100% expensed through 2029. According to the Congressional Budget Office, the Big Beautiful Bill has a preliminary expected increase to the deficit of over $3 trillion. This increase coincides with the bill also raising the debt ceiling by $4 trillion, which, as I previously wrote for Forbes, might be a significant piece contributing to the US credit rating downgrade and spooking bond markets. In addition to campaigning to extend or make many of the previous tax cuts permanent, this bill makes good on many of Trump's other campaign promises. According to The Guardian, Trump campaigned for several tax cuts for working-class and low- and middle-income taxpayers. These included writing off overtime, tips, and the interest paid on car loans. He also campaigned for an enhanced child tax credit and a savings account. All of these promises of renewed spending and tax cuts appear in the version of the bill passed by the House. A contentious item to the very end of the House's passage was the deduction for state and local taxes paid. Taxpayers who are itemizing their taxes (rather than taking the standard deduction) are permitted to deduct taxes paid to state and local jurisdictions. This deduction can include many things, but the most common source is taxes paid for property ownership. Under the Tax Cuts and Jobs Act of 2017, this deduction was significantly limited to a maximum of $10,000. The limit created significant tension among policymakers as the $10,000 applied equally to all taxpayers. While taxpayers in lower cost-of-living and low-tax states potentially viewed the $10,000 cap as reasonable, taxpayers in higher cost-of-living and high-tax states were more likely to exceed this cap, losing out on significant tax deductions. According to CNBC, in the Big Beautiful Bill, this cap was raised to $40,000 with the deduction phasing out for high-income-earning taxpayers (over $500,000). The cap would also increase annually by 1% from 2026 through 2033. As most lower-income taxpayers do not itemize their taxes and the increased deduction does not benefit higher-income households, this enhanced deduction appears to lead to significant tax relief among the middle class. Despite the potential benefits of an enhanced state and local tax deduction, this is a provision to watch as the bill moves to the Senate. According to Politico, many in the other chamber are weary over this particular provision, and it could be met with friction. To pay for such sweeping tax decreases, the House had to make cuts in spending, and many of these cuts pertained to social services. MSNBC reports that the bill cuts federal funding for SNAP by $267 billion and Medicaid by $700 billion. Between 8 and 15 million people would lose health care coverage among these cuts. This would result in household resources among the poorest taxpayers declining by over 4% in the next eight years. The Big Beautiful Bill would also significantly increase work requirements for Medicaid recipients. However, the social services cut is aimed not only at those receiving government assistance for health insurance and food. As reported by Forbes, Taxpayers receiving federal student loans for college would also face very new programs and conditions for borrowing money. For instance, loans would be calculated based on the median cost of all similar college programs (rather than the specific school), loans would have a maximum amount of $50,000 for undergraduate (150,000 for professional programs), restrictions on who can receive loans, abolishing most student loan payment plans, and new limits on pausing student loans. These provisions will significantly affect current students and students who are still paying off their loans. Since the moment Trump won the election, he eyed the passage of this domestic policy agenda during the first year of this term. The passage of the Big Beautiful Bill in the House is a significant step toward accomplishing this goal. The Republican party held a very thin majority in this chamber as the Republicans could only lose three votes to pass the legislation. The bill now heads to the Senate, where many other difficulties might arise. However, as it is being proposed as a budget reconciliation, the bill only needs a simple majority (rather than 60 votes) to be passed. According to CNN, Trump eyes Independence Day as the day when he will sign the Big Beautiful Bill into law, making these changes effective for the current year. The bill getting passed the House in this razor-thin vote is a critical step toward accomplishing that goal.
