Senate Republicans Approve Budget Resolution in Key Step Toward Tax Bill
On April 5, 2025, Senate Republicans voted 51-48 to adopt a budget resolution that would allow up to $5.5 trillion in net tax cuts over a decade, increase spending on border security and military, and cut spending by at least $4 billion. The Senate plan would also increase the debt ceiling by up to $5 trillion. Republicans Rand Paul and Susan Collins voted against the resolution.
Republicans will pursue a bill to implement their agenda through the reconciliation process, which requires only a simple majority to pass legislation. Republicans have a 220-213 House majority and a 53-47 Senate majority.
While the House and Senate have each pursued their own bill, the reconciliation process requires both chambers to agree on a budget framework before passing a detailed bill.
Key House Republicans have expressed opposition to the Senate plan for not cutting spending enough. The Senate budget plan, however, is a compromise between Senate Majority Leader John Thune, House Speaker Mike Johnson, and top Republican tax leaders.
Taxes and Spending
There are several key tax and spending issues to be resolved, including border security, oil and gas drilling, defense spending, and tax cuts. The $5.5 trillion budget for tax cuts includes $4 trillion for the extension of the TCJA and $1.5 trillion in additional tax cuts. These include Trump’s plan to exclude tips, overtime pay, and Social Security benefits from taxation.
The resolution also directs the House Energy and Commerce Committee to reduce the deficit by $880 billion, which many argue will require cutting Medicaid.
Baseline
Additionally, there is controversy over the Senate’s proposal to use a “current-policy baseline” to score the extension of the Tax Cuts and Jobs Act. This scoring baseline assumes that extending the 2017 Trump tax cuts will not have a cost because the current policy would continue.
By contrast, a “current law” baseline would assume that the tax cuts expire, as scheduled under current law, making extension of the tax cuts score like a new tax cut that would incur a cost. The 1974 Budget Control Act requires Congress to use a “current law baseline” for budget measures.