Trump’s “big, beautiful” tax bill creates tensions in GOP

Speaker Mike Johnson spent the week racing from office to office on Capitol Hill before members took a final vote on President Donald Trump’s self-described “big, beautiful bill.”A plan that has divided the GOP.

The massive bill combines tax, immigration, energy, defense, and debt-ceiling measures. It has also reopened many old divisions in the GOP and created a few new ones, a risky mix for leaders who can afford to lose only a handful of votes.

Conservative members of the House Freedom Caucus are pressing hardest, according to Fox News. They want the bill to shrink Medicaid’s Affordable Care Act expansion and to implement work requirements for able-bodied adults on the healthcare program before the bill’s 2029 deadline.

Most Republicans agree that people who are able to work should do so in order to keep government health coverage, but moderates warn that cutting too deeply into the Obamacare expansion could cost them support in tight districts.

Freedom Caucus lawmakers say their goal is simply to move limited resources toward the poor, women, and children who need help the most.

The same conservatives also demand a full reversal of President Joe Biden’s green-energy tax credits in the Inflation Reduction Act. That stance has put them at odds with Republicans from districts where companies have already based business plans on those incentives.

At the same time, moderates from California, New York, and New Jersey are focusing on the state and local tax, or SALT, deduction cap. They argue that lifting that limit is essential for residents of high-cost areas such as New York City and Los Angeles.

Several of those lawmakers say the issue will decide whether the GOP can keep its seats, and possibly the House majority, in 2026. They also note that their narrow 2024 wins relied on the same voters.

GOP clash over raising the state and local tax deduction limit

The $10,000 SALT cap first appeared in President Trump’s 2017 Tax Cuts and Jobs Act. It remains popular with most Republicans, especially those from lower-tax states. Republicans in Tennessee and Missouri say raising the cap gives unfair tax breaks to high-tax Democratic states. Republicans in coastal states say they send more money to Washington, which benefits low-tax states.

Some Republicans in states with green-energy companies don’t want big cuts to those tax credits. Representatives from Arizona and Pennsylvania say taking the credits away now would hurt businesses that already counted on them.

In March, twenty-one House Republicans sent a letter urging leaders to keep those benefits. “Countless American companies are utilizing sector-wide energy tax credits, many of which have enjoyed broad support in Congress, to make major investments in domestic energy production and infrastructure for traditional and renewable energy sources alike,” they wrote.

Conservative fiscal hawks responded with their own letter, insisting that the fast-growing green-tech field is funded by government handouts, not genuine market demand.

“Leaving IRA subsidies intact will actively undermine America’s return to energy dominance and national security,” they said. “They are the result of government subsidies that distort the U.S. energy sector, displace reliable coal and natural gas and the domestic jobs they produce, and put the stability and independence of our electric grid in jeopardy.”

Your crypto news deserves attention - KEY Difference Wire puts you on 250+ top sites