Senate tees up major tax fight after House squeaks through on budget
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Senate Majority Leader John Thune (R-S.D.) and Republicans on the Senate Finance Committee began hashing out what to do on taxes in a closed-door meeting Monday evening.
Why it matters: Don't expect the budget resolution that barely passed the House last week to stay as is. The two chambers passed very different budget resolutions.
- They will need to get on the same page to kick off the reconciliation process, which allows the Senate to get around its 60-vote filibuster.
- "We're working to put it all together in a way that makes the tax cuts permanent, prevents an increase in taxes, and deals with the key components and promises of the administration," Senate GOP Whip John Barrasso (R-Wyo.) told Axios.
What to watch: Senate Finance Chair Mike Crapo (R-Idaho) and House Ways and Means Chair Jason Smith (R-Mo.) huddled separately right after the Senate meeting.
- Those two will be leading the tax debate for each chamber — a fight that could drag out for months.
- There's a lot less of an appetite for raising the SALT caps in the Senate than in the House.
Zoom in: One of the biggest changes the Senate is looking at is how it counts the cost of extending the 2017 Trump tax cuts, with Senate leadership pushing to adopt a current policy baseline — which makes the cost $0.
- "My understanding is that is a decision a parliamentarian is going to make," Sen. John Cornyn (R-Texas) told reporters after the meeting.
- Some conservatives like Sen. Rand Paul (R-Ky.) won't like it, though Sen. Ron Johnson (R-Wis.) told Axios he is on board.
- "One point I tried to make is, I don't think that changes one iota how much money we spend," Cornyn said, adding, "I think it just demonstrates how illusory all the scoring really is."
