Senate Votes to Advance Trump’s Megabill as July 4 Deadline Looms

Senate Majority Leader John Thune at the Capitol. (Photo by SAUL LOEB/AFP via Getty Images)

The Senate voted to advance President Donald Trump’s tax and spending bill, setting up a potential final vote in the chamber this weekend or early next week.

The motion to proceed in the Senate passed on a vote of 51 to 49, with two Republican senators dissenting. The vote essentially starts a 20-hour clock for debate, after which senators will likely vote on amendments to the bill. That process itself can last dozens of hours, depending on how many amendments senators bring up for a vote.

However, the approval of the motion to proceed means that Trump’s signature legislation is likely to pass in the Senate in the coming days.

The House of Representatives, which was originally scheduled to be on recess the week of June 29, will seek to swiftly vote on the package and send it to Trump’s desk by July 4.

The Senate amended its version with key updates early Saturday. It raised the so-called SALT deduction cap to $40,000 from $10,000 through 2029 before it drops back to $10,000. The House’s bill permanently raised the deduction for state and local taxes to $40,000 from $10,000 for households making more than $500,000.

The Senate’s latest version of the bill also includes a faster phaseout of wind and solar tax credits, and the formation of a $25 billion fund to mitigate the impact that Medicaid cuts would have on rural hospitals.

Medicaid has been a significant sticking point during talks over the legislation. The Senate initially made deeper cuts to Medicaid than what passed in the House, while loosening the phaseout of some green energy credits included in President Joe Biden’s Inflation Reduction Act.

To meet the July 4 deadline, the House would have to swallow the Senate version without making more changes of its own. Trump himself on Friday said meeting the deadline may not be possible, calling July 4 “important” but “not the end-all.”

Republicans can lose three votes in the House and three in the Senate and still pass the bill along party lines. The narrow margin means any GOP faction could grind the process to a halt, putting the pressure on Trump to make sure nearly every Republican lawmaker falls in line to vote in favor of the bill.

The practical deadline for lawmakers comes later in July.

Treasury Secretary Scott Bessent has said that the U.S. is at risk of hitting the debt ceiling as soon as August. Since the bill is also being used to raise the ceiling, that will put new pressure on Congress to pass it before lawmakers go on recess during the last week of July.

— Rebecca Ungarino contributed to this article.

Write to Joe Light at joe.light@barrons.com