The US House Budget Committee on 13 February approved a FY2025 budget resolution that provides reconciliation instructions to the House Ways & Means Committee. The budget resolution calls for up to a $4.5t net increase in the deficit over 10 years to accommodate Tax Cuts and Jobs Act (TCJA) extensions and requires other committees to achieve $1.5t in savings. The Ways & Means instruction offers little room for additional tax cuts, although funding for President Trump's other tax proposals could come from potential savings in the Code, including from Inflation Reduction Act energy tax credits.

The House is in recess next week. Ways & Means Committee Republicans suggest the budget resolution may come for a floor vote the week of 24 February, with committee action on legislative text to follow soon thereafter.

The debate between the House and Senate regarding whether there should be one budget reconciliation bill or two bills remains unsettled, however.

The Senate Budget Committee on 12 February approved a separate FY2025 budget resolution. Under this plan, Congress would pass two budget reconciliation bills this year, with border security and other Administration priorities enacted in the first reconciliation bill and tax measures addressed in a second bill later in the year. Floor consideration of the Senate budget resolution may happen next week.

President Trump on 13 February signed a Reciprocal Trade and Tariffs Memorandum directing the Administration to conduct a review process to calculate and ultimately impose reciprocal tariffs on a country-by-country basis, accounting for both tariff rates and non-tariff barriers. Any new tariffs under the memo could be months away. The memo described a "Fair and Reciprocal Plan" to counter non-reciprocal trading arrangements with trading partners by determining the equivalent of a reciprocal tariff with foreign trading partners. In remarks the same day, President Trump said there would be no exemptions from the potential tariffs.

The OECD Forum on Tax Administration on 29 January updated its website to publish additional information regarding the Main Documentation Package for participation in the International Compliance Assurance Programme (ICAP). The document package is to be submitted following the end of the selection stage and before the risk assessment stage begins. The OECD's website now includes the following templates for the Main Documentation Package — Checklist and Covered Transactions Schedule. The update to the Main Documentation Package provides practical information regarding ICAP requirements.

Importantly, the OECD requirement to prepare a Country-by-Country Reporting (CbCR) self-assessment as part of the Main Documentation Package has been eliminated, simplifying the application process. A Global Tax Alert provides details.