Senate Advances Trump’s $4.5 Trillion Tax Bill, But Final Passage Remains Uncertain

President Donald Trump’s massive $4.5 trillion tax and spending package cleared a crucial procedural vote in the Senate late Saturday, marking a significant—yet incomplete—step toward final approval. Despite advancing, the bill still faces serious resistance within the GOP, and leadership must convince a few remaining holdouts in a tightly divided chamber.

Senate Majority Leader John Thune managed to rally just enough Republican support to open debate on the bill. With only 53 GOP senators in the chamber, he can afford to lose no more than three votes to pass the legislation. Though the official debate is now underway on the Senate floor, real negotiations are happening behind closed doors as Thune and other senior Republicans push to shore up the remaining support.

A final vote could come as soon as Monday, but not before senators consider a slew of amendments starting Sunday. While most proposed changes are expected to be rejected, a handful may be adopted to bring skeptics on board.

President Trump, closely watching developments from the White House, is applying intense pressure on dissenting Republicans. He publicly threatened to back a primary challenger to North Carolina Senator Thom Tillis, who joined Kentucky Senator Rand Paul in voting against advancing the bill.

Vice President JD Vance was deeply involved in Saturday’s vote, spending hours on the Senate floor lobbying skeptical senators. His efforts helped flip Senator Ron Johnson of Wisconsin, who initially voted “no” but switched after securing a commitment to include an amendment phasing out funding for Medicaid expansion—an issue important to fiscal conservatives.

Moderate Republicans remain wary. Senator Susan Collins of Maine supported the procedural motion but warned she couldn’t back the bill without changes to soften the blow of proposed Medicaid cuts. Senator Lisa Murkowski of Alaska agreed to move forward only after assurances from Thune. Senators Rick Scott (FL), Mike Lee (UT), and Cynthia Lummis (WY) are also seeking further changes.

One controversial proposal—led by Mike Lee—to sell 1.2 million acres of federal land for development was dropped Saturday after strong pushback from Western-state Republicans.

What’s in the Bill: Tax Cuts, Spending Hikes, and Internal Battles

The bill includes $4.5 trillion in tax reductions, according to the nonpartisan Joint Committee on Taxation. But GOP leaders only plan to count $693 billion of that in the official budget score, using accounting tactics that exclude long-term extensions of earlier tax breaks.

The package also includes billions in new funding for border security and defense, but it’s sparked deep internal divisions. Conservatives are demanding steeper cuts to social programs to offset the tax breaks. Meanwhile, moderates are alarmed by the scope of proposed reductions to Medicaid and food stamps. Senators from renewable energy-heavy states are also pushing back against rollbacks to green energy incentives.

To ease concerns from moderates, the latest draft includes a $25 billion fund to support rural hospitals expected to be affected by Medicaid cuts. Collins had originally demanded four times that amount. Additionally, a new provision delays a planned 3.5% cap on state Medicaid provider taxes from 2031 to 2032, with a gradual rollout beginning in 2028.

Energy Provisions: Green Incentives Face Cutbacks

Conservatives scored a win with changes that fast-track the phaseout of renewable energy tax credits. Wind and solar projects must now be fully completed—not just under construction—by the end of 2027 to qualify for incentives.

The widely used $7,500 tax credit for new electric vehicles would also end earlier than initially proposed. Under the latest draft, the credit would expire on September 30, 2025. Incentives for used and commercial EVs would phase out at the same time.

SALT Cap and Tax Break Extensions

The revised bill includes a tentative agreement to raise the cap on state and local tax (SALT) deductions. The limit would temporarily increase from $10,000 to $40,000 starting in 2025, phasing out for taxpayers earning over $500,000. After five years, the cap would revert back to the current level.

A separate effort to restrict business loopholes used to bypass the SALT cap was dropped from the bill text.

The legislation would also make permanent the individual and corporate tax cuts passed in 2017 under Trump, while temporarily introducing new credits for overtime workers, seniors, and car buyers.

Debt Limit Increase Included

To prevent a possible payment default this summer, the bill includes a $5 trillion increase to the federal debt ceiling. Treasury officials have warned that the U.S. could run out of money to meet its obligations by August without congressional action.

Next Moves: GOP Faces Tight Deadline, Unsettled Votes

Despite clearing a key procedural hurdle, the bill’s future remains murky. Senate leaders are still working behind the scenes to lock in enough Republican votes for final passage — with just three defections threatening to tank the effort. Even if it passes the Senate, the House will have to approve any last-minute changes, where tensions over Medicaid, tax breaks, and spending cuts could reignite. With the July 4 deadline looming, Republicans are under pressure to deliver a win for Trump — but growing fractures inside the party could derail the deal at the last minute.

Also Read: Trump Sends VP Vance to Capitol Hill as GOP Scrambles to Pass $4.2 Trillion Tax and Spending Bill