Senate Passes Budget Resolution, Moves to House

The Senate has passed a budget resolution that unlocks their ability to pass a party-line bill later this year, combining an overhaul of the tax code with border, energy, and defense policies. The resolution now moves to the House, where Speaker Mike Johnson faces challenges in securing enough votes for approval.

Senate Budget Resolution Update

On April 4, 2025, Senate Republicans adopted a budget resolution that faces an uphill battle to become law. House fiscal hawks are vowing to change the resolution. Speaker Mike Johnson can only afford to lose three Republican votes to still have the bill pass. Senate Majority Leader John Thune emphasized the importance of moving quickly to resolution. Key points to watch over the coming days include:

1. Tax Plan Approval: Senate Republicans bypassed parliamentarian approval, risking future complications. They set a $1.5 trillion cap for tax writers, in contrast to the House’s $4.5 trillion cap, using an accounting maneuver called the “current policy baseline” to make extending the 2017 tax cuts appear cost-free.
2. Debt Ceiling: GOP senators rejected a proposal from Senator Rand Paul to shrink the size of the debt ceiling hike prescribed by the budget resolution from $5 trillion to $500 billion.
3. House Approval: Members of Senate GOP leadership believe the House would adopt the budget resolution without change, expediting the reconciliation bill process. However, Speaker Johnson faces pushback from hard-liners, deficit hawks, and tax writers.

If the budget resolution passes in the House, the two chambers will have to resolve significant policy decisions over finding savings to offset the final reconciliation bill. The Senate budget plan only requires a minimum of a few billion in deficit reduction, compared to the House GOP’s promise to its members to reduce the deficit by $2 trillion.

The House’s instructions to its committees have caused concern in the Senate over potential Medicaid cuts. Meanwhile, Senator John Thune needs to manage deficit hawks who want steeper cuts in the reconciliation bill, aiming for up to $6.5 trillion in deficit reduction.

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