Senate Republicans taking first big step toward tax overhaul

close

Video

Senate holds first vote toward budget legislation

President Trump: First step toward massive cuts.

Senate Republicans are on track to take their first big step toward the “massive” tax reform package that President Trump has promised with plans to vote on a related budget plan as early as Thursday night.

The $4 trillion nonbinding budget plan would serve as a vehicle for tax legislation later this year, as it would allow the Senate to use a special process that avoids a Democratic filibuster.

Republicans are expected to have the votes for the first step, though Trump left that question open as he touted the plan Thursday morning on Twitter.

"Republicans are going for the big Budget approval today, first step toward massive tax cuts. I think we have the votes, but who knows?" Trump tweeted.

The House passed its version last week. The passage of the budget plan in both chambers in hopes of setting the stage for tax reform is a crucial step for Republicans, after falling short on their seven-year promise to repeal and replace ObamaCare.

“Passing this budget is critical to getting tax reform done, so we can strengthen our economy after years of stagnation under the previous Administration,” Senate Majority Leader Mitch McConnell, R-Ky., said on the Senate floor Thursday morning. “It’s pretty obvious that this is a good budget—and that’s true whether you’re looking at it from a fiscal perspective or an economic one.”

The budget plan calls for $473 billion in cuts from Medicare over 10 years and more than $1 trillion from Medicaid.

“Anything that we do here has to be completed in other committees in order to ever happen,” Senate Budget Committee Chairman Mike Enzi, R-Wyo., said. “But this budget does slow Medicare’s projected annual rate of growth by approximately 1 percent.”

With this plan, Senate Republicans would cut spending by more than $5 trillion over the next 10 years, with an average of approximately $540 billion per year over the life of the plan, according to the Congressional Budget Office estimate.

The tax plan could also add $1.5 trillion to the deficit over the next 10 years, though McConnell said “it's a fiscally responsible budget that will help put the federal government on a path to balance."

While Trump voiced uncertainty about the vote tally, one development works in Republicans' favor.

Sen. Thad Cochran, R-Miss., who had been out of Washington after weeks in his district being treated for urological problems, is back to Capitol Hill and ready to vote Thursday night. Other critical votes from moderate Republicans, like Sens. John McCain, R-Ariz., Bob Corker, R-Tenn., and Susan Collins, R-Maine, would back the effort.

But despite the relatively cozy relationship Sen. Rand Paul, R-Ky., has developed with Trump, he is the sole wild-card vote for the GOP, being the only Republican to come out against the measure.

Republicans can only afford to lose two votes and still pass the budget plan.

"The fact is, most of the rest of the world has been about the business of improving their tax code while we have not," Sen. Pat Toomey, R-Pa., said. "This is our moment, our opportunity to catch up, and we could do it in a big way as long as we pass this budget."

Senate Democrats, meanwhile, are against the measure.

"There’s going to be a very bright light shining on our Republican colleagues in the House and Senate," Senate Minority Leader Chuck Schumer, D-N.Y., said Wednesday. "It’s not easy writing a massive tax bill, and all the while, while they’re writing it and once it comes out, that bright light of truth will produce, in my judgment, the same result we had on health care: the more the American people see, the less they’ll like it."

Fox News' Brooke Singman and Chad Pergram and The Associated Press contributed to this report.