House Republicans seem poised to make changes to their party-line tax, energy and national security bill this week — potentially including a more aggressive repeal of clean energy tax credits — before trying to pass the legislation through the lower chamber.
The House Budget Committee advanced the package late Sunday after GOP leaders granted a group of conservative holdouts a number of concessions, but they did not say what those deals entail.
But Rep. Chip Roy (R-Texas) said on social media, “Importantly the bill now will move Medicaid work requirements forward and reduces the availability of future subsidies under the green new scam.”
Four hard-line Republicans who opposed the bill Friday voted “present” Sunday to advance the package to the Rules Committee before hitting the floor.
And Rules says it will take up the measure at 1 a.m. Wednesday. That’s the earliest the panel can set floor debate parameters under certain procedural requirements.
Still, the far-right House Freedom Caucus posted on X that the legislation — as is — “does not yet meet the moment.” Roy said that’s partly because it leaves “almost half of the green new scam subsidies continuing.”
Leaders also have to contend with a group of blue-state Republicans who are similarly holding the line on state and local tax deductions. Another faction wants to see softer language on the restrictions and phase down of the Inflation Reduction Act’s tax credits. And across the Capitol, Senate Republicans are watching closely, vowing to pursue additional changes to the bill’s tax and energy proposals.
“I couldn’t tell you what is in flux, what is fixed, what might change or not change,” said Budget Chair Jodey Arrington (R-Texas). “As you all well know, this process is fluid.”
He said conversations with members and leadership would happen through the week but rejected the claim by Democrats there were “side deals” happening in backrooms.
“I don’t know anything about side deals or any deals, I just know we are at a place where we can take a vote today,” Arrington said, noting formal changes would be in a manager’s amendment at Rules.
Before the committee vote Sunday, House Speaker Mike Johnson (R-La.) expressed tepid confidence, adding, “We never stop working on these things.” He told reporters “minor modifications” were made over the weekend. “Not a huge thing,” he said. “Wait and see.”
On Friday after the first failed vote, Budget Vice Chair Lloyd Smucker (R-Pa.), who supports the package, argued the hard-liners who voted “no” actually support “most of what came out of the committee here. There’s just a few remaining issues. But yes, we want to get there as quickly as we possibly can.”
The budget reconciliation package, which Republicans are looking to approve by simple majority, also contains public land sales, changes to federal rulemaking and deep cuts to climate-related grants.
Clash over IRA credits
For months, warring factions in the GOP have fought over how to handle the Democrats’ 2022 climate law, with moderates pitted against hard-liners. While dozens of House Republicans have signaled an interest in protecting parts of the Inflation Reduction Act tax credits, few have made clear they would tank the whole package over parochial energy interests.
Still, House Republican leaders have already told hard-liners a full repeal of the IRA’s clean energy subsidies would cost the bill crucial support, POLITICO reported.
Last week, Rep. Jen Kiggans (R-Va.), who represents a toss-up district that also is host to a massive offshore wind project, approached Johnson on the House floor to request a meeting seeking changes that would ease the blow to renewable industry tax credits. There’s no indication the meeting has happened; Johnson’s office did not return requests for comment.
In particular, Kiggans and 13 others, have suggested a provision intended to disqualify Chinese companies from accessing the credits as too cumbersome. That’s a concern shared by many in the renewables industry.
“In general, we see where the Committee was trying to go,” said Yogin Kothari, chief strategy officer for the Solar Energy Manufacturers for America (SEMA) Coalition.
“That said, the language is complex and will take some time to unpack and there could be some implementation challenges that would result in unintended consequences in our efforts to reshore critical supply chains,” Kothari said.
As evidence of the division among Republicans on the IRA, the Oversight and Government Reform Subcommittee on Economic Growth, Energy Policy and Regulatory Affairs will hold a hearing Tuesday on the law’s negative effects to the energy industry.
One Democrat said the party failed to get through to voters — particularly Republicans in rural areas — about the benefits of the IRA programs across red states.
“There’s an intellectual inconsistency here: The people who are benefiting most from those provisions are the voters and the Republican colleagues who will continue to go after all the work that happened on climate,” said Rep. Becca Balint (D-Vt.).
“So what’s so hard in this moment is how do we as Democrats punch through to do a better job of shining a light on all that … because there seems to be a disconnection in the public,” Balint said.
Senators eye more changes
As House members spar over portions of the reconciliation bill, a number of senators have been mulling tweaks of their own.
Some want more aggressive spending reductions; others prefer a softer touch and could add new wrinkles to the process in the coming weeks.
Some senators could try to put new pressure on leadership to delay some of the tax credit phaseouts and other changes the House is pursuing.
Alaska Sen. Lisa Murkowski, one of four Republican senators who last month signed onto a letter calling for a “targeted, pragmatic approach” to the tax credits, suggested she has qualms with the current package.
Asked last week whether she would vote for the “big, beautiful bill” as is, she quipped, “As far as I know, it’s not beautiful yet!”
From the other side of the spectrum, Energy and Natural Resources Chair Mike Lee (R-Utah), who like House conservatives is seeking more savings, was more blunt. “There is still time to fix it,” he said in a social media post last week.
“We MUST deliver on President Trump’s promises to the American people, enact real, immediate, and lasting spending cuts, and eliminate the Green New Scam,” he said on X.
Ohio Sen. Bernie Moreno, a former luxury car dealer, said he prefers an outright repeal of the consumer tax credit for electric vehicles extending to all manufacturers, not just ones that have sold more than 200,000 cars, as the House bill proposes.
“Certainly, my inclination is when that bill gets to the Senate, that the EV subsidies need to go away immediately — not phased out and not [with] any kind of artificial limitation in terms of volume,” he said.
Sen. John Kennedy (R-La.), a Budget Committee member and the chair of the Senate Energy-Water Appropriations Subcommittee, said he was pleased with some of the House’s proposals on energy and climate programs, including rescinding unobligated IRA funding for the Department of Energy’s Loan Programs Office.
“We need to take all that money back and start over,” Kennedy said. However, he added he still wants to “change a lot of it.”
Schedule: The House Oversight and Government Reform hearing is Tuesday, May 20, at 10 a.m. in HVC-210 Capitol and via webcast.
Witnesses:
- Ben Lieberman, senior fellow, Competitive Enterprise Institute.
- Erin Trish, co-director, USC Schaeffer Center, and associate professor, USC Mann School of Pharmacy.
- William McBride, chief economist, Tax Foundation.
Schedule: The House Rules meeting is Wednesday, May 21, at 1 a.m. in H-313 Capitol and via webcast.
