House GOP Unveils Budget Plan with $4.5 Trillion in Tax Cuts

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House GOP Unveils Budget Plan with $4.5 Trillion in Tax Cuts \ Newslooks \ Washington DC \ Mary Sidiqi \ Evening Edition \ House Republicans unveiled a $4.5 trillion tax cut plan alongside a $4 trillion debt limit increase, aligning with Donald Trump’s domestic agenda. The proposal calls for $1.5 trillion in spending cuts, with reductions targeting Medicaid and social programs, while increasing defense and border security funding. Democrats criticize the plan for benefiting the wealthy and expanding the national debt.

House GOP Budget Plan: Quick Looks

Republicans propose $4.5 trillion in tax cuts and a $4 trillion debt ceiling increase.
The plan directs $1.5 trillion in spending cuts, with $2 trillion in reductions over 10 years.
Key cuts target Medicaid, education, and agriculture, while increasing defense and border security funding.
House Speaker Mike Johnson aims for quick passage, but GOP members remain divided on tax and spending levels.
Democrats warn the budget benefits the wealthy, while forcing cuts to social programs.
Senate Republicans are advancing a separate budget plan with a focus on border security and defense.
The House favors a single bill, while the Senate moves forward with a two-bill approach.

Deep Look

House Republicans Push for Sweeping Tax Cuts & Spending Reductions

On Wednesday, House Republicans introduced a budget resolution that seeks to advance Donald Trump’s key domestic priorities, proposing $4.5 trillion in tax cuts while raising the debt ceiling by $4 trillion.

The plan includes significant spending cuts, aiming for at least $1.5 trillion in reductions, though GOP leaders set a goal of $2 trillion in total cuts over the next decade.

The budget blueprint marks the beginning of a lengthy legislative process, with House committees tasked with reshaping federal spending to align with Trump’s policy agenda.

House Speaker Mike Johnson projected confidence in the plan’s approval, stating:

“Then, we’ll work with everybody over the week to make sure they are on board.”

However, divisions within the Republican Party remain over the scope of tax cuts and spending reductions.

Where Are the Spending Cuts Coming From?

The GOP plan targets social services as a way to fund tax cuts and Trump’s other priorities. Key reductions include:

$880 billion in Medicaid and healthcare spending cuts (via the Energy and Commerce Committee).
$330 billion reduction in education and workforce programs.
$230 billion in agricultural spending cuts.
$10 billion in transportation and infrastructure reductions.

At the same time, funding would be increased in areas central to Trump’s agenda, including:

$100 billion in additional defense spending over the next decade.
$90 billion in additional funding for Homeland Security to support Trump’s expanded immigration enforcement and deportations.

Republican Divisions Over Tax & Spending Cuts

Within the House GOP, there are disagreements over the extent of tax and spending changes:

Some Republicans want larger tax cuts than what is currently proposed.
Others demand deeper spending cuts, particularly in social services.

Despite these differences, Speaker Johnson emphasized the need for negotiation:

“There’ll be a lot of negotiations back and forth. There’s a lot of moving parts to this, but our objective is to fulfill all the president’s campaign promises and the full agenda.”

Democratic Criticism: “A Giveaway to the Wealthy”

Democrats strongly oppose the budget, arguing it prioritizes tax cuts for corporations and the wealthy over working-class Americans.

At a joint press conference, Senate Majority Leader Chuck Schumer and House Minority Leader Hakeem Jeffries condemned the plan:

“Why? Their primary objective is to enact massive tax cuts for their billionaire donors and wealthy corporations,” Jeffries said.

Democrats also warn that the tax cuts will not pay for themselves, forcing deeper cuts to social programs like Medicaid.

Rep. Brendan Boyle (D-PA), the top Democrat on the House Budget Committee, said:

“Their plan blows up the deficit and sticks the middle class with the bill, whether through higher prices, deep cuts to essential programs, or both.”

Medicaid Work Requirements: A Controversial GOP Proposal

While Republicans insist they do not plan to strip Medicaid benefits, they propose adding work requirements for able-bodied recipients.

Speaker Johnson defended the move, saying:

“If you add work requirements to Medicaid, it makes sense to people. It’s common sense. Work is good for you. You find dignity in work.”

Democrats argue that such changes would create barriers for vulnerable Americans, effectively reducing benefits.

GOP Eyes Rollback of Biden-Era Clean Energy Tax Credits

To offset the cost of Trump’s tax cuts, House Republicans are considering eliminating some clean energy tax credits that were passed under former President Joe Biden.

These credits were designed to encourage investment in renewable energy, but Republicans view them as unnecessary subsidies that should be removed to balance the budget.

Senate Republicans Take a Different Approach

While the House is moving toward a single budget bill, Senate Republicans favor a two-step approach, focusing first on border security and defense spending.

The Senate Budget Committee introduced a separate budget plan that would allocate:

$175 billion for border security.
$150 billion for defense spending.
$20 billion for the Coast Guard.

Immigration at the Center of Senate Debate

Sen. Lindsey Graham (R-SC), chair of the Senate Budget Committee, urged quick action on immigration funding, arguing that Immigration and Customs Enforcement (ICE) is running out of money to conduct deportations.

“We need to move on this issue,” Graham said.

The Senate’s plan does not include tax cuts, opting to tackle those separately in a second bill later this year.

Sen. Jeff Merkley (D-OR), the committee’s top Democrat, criticized the approach, accusing Republicans of repeating past mistakes by pushing massive tax cuts that benefit the wealthy.

“We are seeing a replay of the charade one more time. The trickle down never trickles down,” Merkley said.

What Happens Next?

House Budget Committee votes on the plan Thursday; approval is expected.
Negotiations within the GOP continue over tax cuts and spending reductions.
The Senate will push its separate budget plan, focusing on border security and defense.
Final legislation is expected later in 2025, but it’s unclear whether the House or Senate approach will prevail.

Final Thoughts

The House GOP budget proposal marks a significant step in advancing Trump’s economic and domestic policy agenda. However, deep party divisions over tax cuts, spending reductions, and immigration funding could slow progress.

Meanwhile, Democrats warn the plan prioritizes the wealthy at the expense of middle-class Americans, setting the stage for intense legislative battles in the coming months.