GOP senators press forward with Trump’s tax cuts package, deferring key decisions

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Senate Republicans are pushing ahead with former President Donald Trump's ambitious tax cuts and spending reductions package this week, despite deferring key decisions, including the financial implications and methods of funding the multi trillion dollar initiative, until a later stage.

The Senate GOP's budget framework is designed to complement the House Republicans' dollar 4.5 trillion tax cuts proposal, which includes slashing approximately dollar 2 trillion from healthcare and other government programmes. If the Senate successfully moves this blueprint forward, it would bring Trump's allies in Congress one step closer to forging a compromise that paves the way for a final legislative outcome in the coming weeks, according to AP.

"We are hopeful that this week we can pass a budget resolution that will unlock the process," said Senate Majority Leader John Thune, R-S.D. "We are continuing to move forward with that."

Despite significant differences between the House and Senate versions, Republicans are under growing political pressure to deliver on what is expected to be Trump's flagship domestic policy extending the tax cuts initially enacted in 2017 during his first term. These tax breaks are set to expire at the end of the year, and Trump has vowed to expand them further, including exemptions on tipped wages, overtime pay, and other earnings, as per AP reports.

Meanwhile, Democrats have strongly criticised the GOP tax plans, labelling them as excessive giveaways to the wealthy. House Democratic Leader Hakeem Jeffries, alongside fellow party members on the Capitol steps, asserted, "We are standing together against the GOP tax scam and in defence of the American people."

One of the central disputes between House and Senate Republicans revolves around the funding of these tax cuts. The current tax reductions are projected to cost the federal government dollar 4.5 trillion in lost revenue over a decade, and Trump's additional tax breaks would drive that number even higher. House Republicans are advocating for offsetting these costs with approximately dollar 2 trillion in cuts to healthcare and other social programmes to curb rising federal deficits and prevent the national debt, currently at dollar 36 trillion, from escalating further.

Conversely, Senate Republicans argue that since the existing tax cuts are already in place, they do not represent new expenditures and therefore do not require offsetting spending cuts. They intend to use the current policy as a baseline moving forward, ensuring that only Trump's proposed new tax reductions are accounted for in budgetary considerations. Senate Republicans are expected to propose significantly lower spending cuts, which could be adjusted upwards if necessary to align with the House's dollar 2 trillion in reductions, AP reports.

Democratic leaders, including Senate Minority Leader Chuck Schumer, have condemned the Senate GOP's approach, calling it a deception. "It is an obscene fraud, and the American people won't stand for it," Schumer declared in a joint letter with Senators Jeff Merkley and Ron Wyden.

New Jersey Democratic Senator Cory Booker denounced the Republican baseline strategy as a "gimmick" that would diminish essential federal services while exacerbating deficits. "What they're investing in is bigger tax cuts for the wealthiest," Booker stated in a landmark overnight speech, AP reports.

As Trump's tax plan advances on Capitol Hill, Treasury Secretary Scott Bessent has been actively engaged in discussions with GOP congressional leaders. During a private meeting with Senate Republicans on Monday, Bessent urged them to accelerate progress. "We just have to start voting," said Senator John Cornyn, R-Texas. "Treasury Secretary made the point that this was something we needed to do and do it quickly," Cornyn added, emphasising that voting is set to commence this week. "We're going to grind through it."

A crucial step in the process involves securing approval from the Senate's nonpartisan parliamentarian, who ensures compliance with budgetary rules. Senators from both parties have been involved in behind-the-scenes negotiations with the parliamentarian's staff, arguing for and against the GOP's proposed baseline approach. However, Republican leaders maintain that Senate Budget Chairman Lindsey Graham, R-S.C., should use his authority to advance their strategy without relying on the parliamentarian's ruling.

What remains certain is the GOP's determination to move swiftly. The framework is expected to pass following an extended overnight voting session, often referred to as a "vote-a-rama", which includes deliberation on numerous amendments and procedural motions. This process could extend into the weekend. Only after the framework is approved will lawmakers negotiate the finer details of the legislation, which could take weeks or even months.

(With inputs from AP)