Tax is being left out of the reconciliation bill provided for under the budget resolution approved by the House Budget Committee yesterday (Thursday, July 16). Reconciliation instructions for a $95 billion bill are only provided to the Agriculture, Armed Services, Intelligence, and House Administration committees. Ways and Means Committee Chairman Jason Smith (R-MO) had pushed for tax issues to be included. Additionally, Budget Committee Chairman Jodey Arrington (R-TX) wanted spending-cut offsets, but that approach was not taken, citing dynamics in the Senate. Other House Republicans expressed concern about the lack of offsets.

After rejecting 14 Democratic amendments, the committee voted 20-14 along party lines to approve the resolution, though conservative budget hawk Rep. Chip Roy (R-TX) missed the vote. The blueprint would allocate $73 billion in defense and intelligence funds related to the Iran war; $12 billion in aid to farmers; and $10 billion for measures aimed at voter fraud. Notably absent were the Ways and Means Committee and any health care instructions related to savings in entitlement programs or abortion funding. "Senior House Republicans say if they tried to offset the bill with spending cuts, the Senate would have a field day with amendments," Punchbowl News reported July 15. Including tax provisions could also open the process to tax amendments that could pass by simple-majority vote, and Democrats could offer any number of amendments related to the "One Big Beautiful Bill Act" (OBBBA) and other issues.

There are open questions about the future of the budget resolution and the follow-on reconciliation bill in both chambers. A House floor vote on the resolution is planned for next week — the last week the House is scheduled to be in session prior to the August recess. The Senate will be in session longer, but there are questions about how the resolution will be received in that chamber. Senator Ron Johnson (R-WI), who is set to take over the Budget Committee chairmanship following the passing of Senator Lindsey Graham (R-SC), has expressed deficit concerns related to previous reconciliation measures.

In a Bloomberg story, "GOP Senators Give Frosty Reception to House Budget Blueprint," Senate Appropriations Chair Susan Collins (R-ME) was quoted as saying, "In general, my view is that we should not be using reconciliation, we should work through the normal appropriations process." The story said of Republican reluctance generally, "The hesitant reactions stemmed from concerns senators said they had about the lack of pay-fors offsetting the spending, the merits of including portions of the voter ID election push Trump has advocated, and the protracted timeline before lawmakers depart Washington for the annual August recess."

"Reconciliation, as you know, is very different in the House than it is in the Senate," Senate Majority Leader John Thune (R-SD) said following the regular weekly party lunches. "They're going to try and mark it up in the committee, and we'll see if they can report it, get it across the floor of the House" and what it includes." Roll Call reported that Thune called reconciliation a "risky proposition" because GOP defense hawks want more spending than the budget resolution allows, while fiscal hawks want to see the new spending offset with cuts to other programs. "It is a very uneven path," he said. "I can't make any guarantees over here."

News sources Thursday reported some members had been told that items that were left out of this process could be gathered up in a fourth reconciliation bill before the end of this Congress. "Tax-cut enthusiasts have continued to talk up the idea of indexing capital gains to inflation as part of a potential GOP affordability agenda," Punchbowl reported. "House GOP leaders are already talking about a potential fourth process that might pick up some of those tax leftovers."

Appropriations - House Speaker Mike Johnson (R-LA) on Thursday proposed bringing up a continuing resolution (CR) to fund the government through the November election before the House recesses for August. With the fiscal year ending September 30, Republicans have expressed concern about the scenario of spending the month before the election fighting with Democrats over a government shutdown. Axios reported that if a "clean" CR vote were to fail on the House floor, it could potentially strengthen the Speaker's ability to pass the third reconciliation bill: "An early defeat on a [CR] would give Johnson a pretext to shoehorn a spending stopgap bill into a September reconciliation package." But the story reported that GOP senators are deeply skeptical about pivoting to a CR in July and want to give the regular appropriations process time to work: "They are aware that public talk of a stopgap measure risks undercutting bipartisan negotiations over full-year spending bills."

Schedule - With the House set to depart at the end of next week for a five-week summer break, House leaders have mapped out an ambitious floor schedule. Along with the spending CR, Republicans plan votes on the $95 billion budget resolution advanced by the Budget Committee this week; a stock-trading ban for members that will be paired with a voter ID measure; and the giant, must-pass annual National Defense Authorization Act (NDAA).

Tax — Senator Chris Van Hollen (D-MD) and Rep. Brittany Pettersen (D-CO) on Thursday reintroduced the Disclosure of Tax Havens and Offshoring Act, which would require US multinationals to disclose their profits, taxes, employees and tangible assets on a country-by-country basis. Van Hollen said the bill will "provide critical transparency to both the American public and investors as to how these corporations abuse our broken tax system and the risks they are taking in the use of offshore tax havens." The sponsors' press release accused corporations of "scheming our tax system to hide their profits."

Health care — The House Ways and Means Committee on Wednesday, July 15, approved:

• H.R. 9641, the Essential Caregivers Act, by a 38-0 vote
• H.R. 3108, the Rural Patient Monitoring Access Act, 39-0
• H.R. 9642, the Medicare Access to Rural Anesthesiology Act, 41-0
• H.R. 9468, the Saving Today's Acute-Care Resources Act (STAR) Act, 40-0
• H.R. 3514, the Improving Seniors' Timely Access to Care Act, 42-0
• H.R. 9644, the Medicare Advantage MLR Transparency Act, 42-0
• H.R. 9645, the Health Care Price Certainty for All Americans Act, 25-15

Today, Friday, July 17 at 12 p.m. is the EY Center for Tax Policy monthly update - July 2026. Register.