The US House Ways and Means Committee Republicans revealed the first part of a tax package under budget reconciliation, focused on extending key elements of the 2017 Tax Cuts and Jobs Act (TCJA)  on 9 May 2025.

Alongside the committee print released by the chairman, the Joint Committee on Taxation has published a technical analysis of the bill, offering detailed insights into its provisions.

This proposed legislation seeks to uphold reduced tax rates for individuals and passthrough businesses, preserve the expanded estate tax exemption, and extend key tax advantages for US multinational corporations. Notably, it does not address the future of the USD 10,000 cap on state and local tax deductions.

Republican lawmakers have been pushing to extend key provisions of Trump’s 2017 Tax Cuts and Jobs Act, which are set to expire this year. The proposed extension is projected to cost USD 4.6 trillion over the next 10 years. However, a clause in the budget requires that the Ways and Means Committee reduce its instructions dollar-for-dollar if other committees fail to identify at least USD 2 trillion in spending cuts within the same timeframe.

The second part of the legislative package is expected to cover more priorities from the administration’s tax agenda, including tax exemptions for tipped and overtime income, a lower corporate tax rate for domestic manufacturing, and other tax relief measures. It will be released by the Ways and Means Committee before it reviews the week of 12 May 2025.

The Ways and Means proposal outlines detailed plans for implementing the extension of expiring tax relief provisions.

Jason Smith, the Chairman of the Ways and Means Committee, announced that his panel is set to review the legislation and evaluate potential amendments starting on 13 May 2025.

Earlier, the Trump administration had proposed USD 163 billion in cuts to the 2026 federal budget. The plan reduces spending on education, housing, and medical research while increasing funding for defence and border security. It also proposes cutting over USD 2.49 billion from the Internal Revenue Service (IRS).