House Republicans are scrambling to patch divisions within their ranks as disputes over taxes, Medicaid, and energy credits threaten to derail President Donald Trump’s expansive legislative agenda before Memorial Day, The Hill reported.
Dubbed by Republicans as their "big beautiful bill," the sweeping legislation includes an extension of Trump’s 2017 tax cuts, repealing certain overtime pay and tips taxes, stricter Medicaid work requirements, and rollbacks of climate-focused tax credits established by Democrats.
However, consensus remains elusive, primarily due to disagreements on the state and local tax deductions, known as SALT, Medicaid reform timelines, and green-energy subsidies.
Speaker Mike Johnson, R-La., acknowledged the difficulty, describing negotiations as adjusting "metaphorical dials," meaning that increases in one area must be offset with cuts elsewhere to keep the bill deficit-neutral. “If you do more on SALT, you have to find more in savings,” Johnson explained.
Moderate Republicans from high-tax states, such as New York and California, have insisted the bill significantly raise the $10,000 SALT deduction cap introduced by Trump in 2017, arguing that the current cap negatively impacts their constituents and threatens GOP electoral chances in swing districts.
Lawmakers like Rep. Mike Lawler, R-N.Y., have pushed for a higher deduction limit —$62,000 for single filers and $124,000 for joint filers — far above the $30,000 limit in the current draft.
“We have been very clear from the beginning: If there was not a fix in this bill for SALT, there would not be a bill,” Lawler said this week. “And as far as I’m concerned, this is not a fix.”
However, fiscal conservatives strongly oppose any increase, saying it disproportionately favors wealthier taxpayers and subsidizes high-tax Democratic-run states. Rep. Byron Donalds, R-Fla., called the $30,000 cap "more than generous," signaling tough negotiations ahead.
Medicaid reforms are another flashpoint.
Conservatives are pressing to expedite new work requirements for Medicaid beneficiaries, which would not start until 2029. They argue for earlier implementation — possibly as soon as 2027 — which would accelerate federal savings and the projected loss of health coverage for millions. This timeline adjustment carries significant political risk, potentially handing Democrats potent campaign ammunition for the 2028 presidential election.
Energy subsidies pose additional complications.
The bill phases out clean-energy credits established by Democrats, but disputes persist over timelines and terms. Hardline Republicans like Rep. Chip Roy, R-Texas, said the bill’s energy subsidy rollbacks aren’t stringent enough, criticizing delayed repeals as inadequate. Moderates, conversely, fear overly aggressive cuts could spike energy prices.
Adding to this complexity are stringent restrictions on sourcing project components from China — rules that could render numerous planned energy projects ineligible for credits, even before official phaseouts begin.
Moderates, including a group of 13 Republicans who wrote to leadership, expressed concern about unintended consequences of aggressive energy provisions, warning, "The last thing any of us want to do is provoke an energy crisis or cause higher energy bills for working families."