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Late in the hours on Saturday, the Senate voted to advance the One Big Beautiful Bill Act, as reported by Forbes. President Trump immediately took to social media to claim victory. While impactful, this bill still has many necessary steps before Trump can sign it into law. This article discusses the current status of this bill in the legislative process and outlines the five key steps that must be taken before it can become a tax law.
Many can recall the School House of Rock's famous "I'm Just a Bill" episode, which features an animated piece of paper named Bill who is hanging out on the steps of the U.S. Capitol in an attempt to become a law. Bill outlines the numerous steps it takes for him to go from the House to the Senate before being signed by the President.
In many ways, the path of the One Big Beautiful Bill Act is very similar. However, tax legislation has a more specific path. For instance, tax legislation must be introduced into the House Ways and Means Committee. This bill was introduced by Representative Jodey C. Arrington (R-TX-19). Thus, even though it is labeled as the bill to address Trump's domestic agenda, it is Congress, not the President, who introduces and passes laws.
The version of the bill that was introduced to the House of Representatives already reflected many changes from what was introduced by Representative Arrington, and the version that was passed on May 22 was the result of amendments, alterations, and compromises that were made to ensure that it achieved even the narrowest of victories, as I previously discussed in a Forbes article.
Like the House of Representatives, the Senate also has an important subcommittee, the Senate Finance Committee, which is delegated the responsibility of creating tax laws. As discussed in a white paper by Pillsbury Law, the One Big Beautiful Bill Act has many provisions that are the same in both House and Senate versions of the tax bill. However, their article also highlights numerous ways that they might differ.
One such example is that the Senate proposes that the SALT tax deduction, an itemized deduction for state and local income taxes paid, remain at $10,000. In contrast, the House version proposes an increase to $40,000. As I previously discussed in a Forbes article, these differences are natural in the legislative process. However, they can lead to intense debates that can make or break a bill's prospects of becoming a law.
On June 28, the Senate voted on whether the Senate Finance Committee's version of the One Big Beautiful Bill Act would be advanced to open discussion on the Senate Floor. This vote passed by a narrow margin (51-49).
While Trump was quick to claim victory, and the bill appears poised to pass the Senate, according to the BBC, the procedural vote was by no means the final passage of the One Big Beautiful Bill Act. I outline the five key steps after the bill advancing in the Senate floor to it ultimately being signed into law by Trump.
Following this vote, the Senate Democrats required the nearly 1,000-page bill to be read out loud in its entirety. Fox News reported that the reading began on the evening of June 28, 2, and it took 16 hours to complete, delaying nearly a full day's worth of progress. Immediately following the reading, USA Today reported that the Senate has been hard at work ironing out the final sticking points.
Once the debate has curtailed, the Senate will enter into a vote-arama. In this situation, senators can introduce an unlimited number of amendments to a reconciliation bill or budget resolution and vote upon them in quick succession. Many expect the numerous amendments decided on by the Senate to be voted on in a quick and orderly manner leading to a rare occurrence of a vote-arama. After all the amendments have been approved or rejected, the Senate will cast its final votes on the passage of the bill.
Unique to this bill is that it is a budget reconciliation bill. As discussed by The New Republic, most Senate bills require 60 votes to be passed. However, a budget reconciliation bill only requires a majority. Furthermore, since the Vice President breaks ties in the Senate, only 50 votes plus the tie-breaking vote of Vice President Vance are necessary for passage in the Senate.
Since the House and Senate bills differ, the One Big Beautiful Bill Act will enter a Joint Conference Committee where representatives from both chambers will come together to decide on the differences between the two bills that they believe will be approved by their respective bodies. It is not uncommon for differences between two chambers to be resolved here. For instance, in the passage of the Tax Cuts and Jobs Act of 2017, the House proposed a 20% corporate income tax rate with 25% for certain entities whereas the Senate proposed a 20% rate for all entities. Following the Joint Conference Committee, the 21% corporate income tax rate was accepted and passed by both House and Senate.
The House and Senate must both agree on new combined version of bill. This agreement is easier said than done as many important provisions may have been altered from original versions passed. For instance, Fox Business reports that one representative has said that One Big Beautiful Bill Act is "dead on arrival" if SALT tax deduction is not increased. Given that original bill only passed House by single vote (215 to 214), it will be interesting to see if consolidated version meets significant resistance.
The goal of any tax bill is to be signed into law by President. While One Big Beautiful Bill Act is effectively product of his domestic agenda and should it be passed would be function of going through budget reconciliation and having control of both House and Senate; some bills are not so fortunate to have such clear path. In case where Trump disapproves of bill; he can veto it thereby preventing it from becoming law. Even though Congress can override veto with two-thirds majority vote; this notion would represent significant hurdle to bill becoming law.
However, nobody expects One Big Beautiful Bill Act to be vetoed. Once House and Senate pass it; it is expected that Trump will sign it into law almost immediately. CNN reports that Trump's goal all along has been to sign bill into law on 4 of July holiday. However; Trump now appears to be open to later passage as long as it is passed soon.