Congressional Republicans are barreling toward a showdown over how much to cut taxes and spending as the Senate and House get set to take up rival fiscal 2025 budget resolutions.
The resolutions are designed as blueprints for the budget reconciliation bills lawmakers will have to move later to enact President Donald Trump’s spending and tax priorities. So far, the House and Senate GOP don’t even agree on what to include in the reconciliation bill, and whether there should be one or two.
The Senate could debate this week a fiscal 2025 resolution, much more modest than the House GOP’s, that would increase spending on defense and border security while increasing deficits by $515 billion, according to the Bipartisan Policy Center.
Although Budget Chairman Lindsay Graham says the new spending will be paid for, the resolution as written requires only modest cuts; the Agriculture Committee would be directed to cut $1 billion over 10 years.
The resolution provides for no new tax cuts or an extension of the 2017 Tax Cuts and Jobs Act’s expiring provisions. Senate Republicans want to leave those big-ticket items for a second reconciliation bill.
The Senate Budget Committee approved the bill last week on a party-line vote of 11-10.
The House GOP is still set on passing one giant reconciliation bill. The budget resolution the House could take up the week of Feb. 24 – the chamber is in recess this week – would allow for up to $4.5 trillion in tax cuts while seeking spending cuts of at least $1.5 trillion. An amendment adopted at the request of the House Freedom Caucus would reduce the tax cuts to $4 trillion unless the spending cuts reach $2 trillion.
The House Agriculture Committee would be directed under the resolution to slash spending by at least $230 billion, which would require reducing existing SNAP benefits, according to Chairman Glenn “GT” Thompson, R-Pa.
The House resolution also is expected to require significant cuts in Medicaid, the health care program for low-income people that rural health care providers are disproportionately dependent on. Hardline conservatives also would like to kill the biofuel industry tax incentives enacted by the Inflation Reduction Act, but those repeal efforts face resistance from Midwest House Republicans as well as GOP senators.
“The president has maintained his commitment to biofuels,” said Sen. Joni Ernst, R-Iowa.
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Sen. John Hoeven, R-N.D., said some clean energy sources like wind are developed enough and don’t need tax credits anymore. However, he said credits for carbon capture like 45Q and biofuels like 45Z are likely to remain in place because there are still efforts to develop new technologies. He added there’s a lot of support for biofuels and carbon capture among Republicans and the president.
Hoeven said the budget resolution instruction to the Senate Ag Committee for a cut of at least $1 billion is likely just a starting point and likely won’t be the final number.
“We’ll look at what the House did,” said Hoeven, who is a senior member of Senate Ag. “GT Thompson’s very thoughtful, see what his reaction is.”
The House and Senate ultimately must reach agreement on a FY25 budget resolution. That will determine whether there will be one or two reconciliation bills and what level of spending and tax cuts the resulting legislation will contain. Thompson has said he expects the cut to SNAP to be much lower than what would be required by the House resolution.
Republicans will almost certainly have to pass a budget resolution without any Democratic votes.
Sen. Amy Klobuchar, D-Minn., said in an interview with CNN's State of the Union on Sunday that the tax cuts are intended to offset the impact of tax cuts.
"They have decided they want to find $2 trillion for their tax cuts for the wealthiest. And we're fine with tax cuts for people making under $400,000 a year, but we're talking about the wealthiest of the wealthiest and their buddies, Elon Musk. So they're looking for that money anywhere they can find it, whether it's on the backs of rural America, whether it's on the backs of veterans, whether it is on the backs of cancer research," she said.
Meanwhile, Agriculture Secretary Brooke Rollins hit the road quickly after being sworn in last week. On Friday, she was in Louisville, Kentucky at the National Farm Machinery Show.
On Monday, she will be in Plains, Kansas, for a roundtable with Kansas GOP Sens. Roger Marshall and Jerry Moran and Rep. Tracey Mann, R-Kan.
Here is a list of agriculture- or rural-related events scheduled for this week in Washington and elsewhere (all times EST):
Monday, Feb. 17
Federal holiday
Tuesday, Feb. 18
9:30 a.m. – WTO Trade Dialogue on Food – “AgTech & Global Trade: Bridging the Future of Agriculture.”
Wednesday, Feb. 19
10 a.m. – Senate Environment and Public Works Committee hearing, “Improving the Federal Environmental Review and Permitting Processes,”406 Dirksen.
10 a.m. – Senate Health, Education, Labor and Pensions Committee hearing to consider the nomination of Lori M. Chavez-DeRemer to be labor secretary, 216 Hart.
Thursday, Feb. 20
Friday, Feb. 21
8:30 a.m. – USDA releases Weekly Export Sales report.
10 a.m. – Washington International Trade Association forum, “WITA’s USMCA Review Series: What’s Outstanding?”
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