The US House this week approved the Consolidated Appropriations Act, 2026, the 1,059-page final component for Congress to complete the 12-bill FY 2026 appropriations process. The House will be in recess next week, with the Senate returning to session on 26 January, giving the Senate five days to consider the consolidated spending bills before the 30 January deadline to avoid a partial government shutdown. The spending package also includes some trade and health-care measures.

The House Ways and Means and Senate Finance Committees reportedly tried to add the widely supported US-Taiwan tax relief legislation to the bill but were rebuffed by congressional leaders, possibly because of the fragility of the final spending legislation. It is unclear what other legislation could serve as a vehicle for the Taiwan tax bill, which originally was passed by the House in 2024 but failed in the Senate.

Speculation continues over how Congress could address tax and other outstanding priorities later this year. House Republicans continue to float the possibility of a second budget reconciliation bill — which would require only a simple Senate majority rather than a 60-vote supermajority — but face skepticism from some Republicans in the House and Senate.

The Trump Administration on 15 January announced that it had reached a trade deal with Taiwan. As part of the arrangement, the US agreed to reduce Taiwan's country-specific tariff rate from 20% to 15%. In addition, the US committed to limit Section 232 tariffs on Taiwanese auto parts, timber, lumber and wood derivative products to no more than 15%. The US also agreed to a 0% tariff rate for "generic pharmaceuticals, their generic ingredients, aircraft components, and unavailable natural resources." Further, the US agreed to preferential duty rates and other import benefits on semiconductors imported by Taiwanese semiconductor producers who invest in the United States.

According to the Commerce Department Fact Sheet, Taiwan agreed to invest "at least [US]$250 billion to build and expand advanced semiconductor, energy, and artificial intelligence production and innovation capacity in the United States." Taiwan also agreed to provide at least US$250b in credit guarantees to Taiwanese enterprises that invest in the semiconductor supply chain and ecosystem in the United States.