On June 5, we catalogued a list of “pork” — wasteful handouts on both the spending side and the tax side — tucked into the House-passed version of the One Big Beautiful Bill. We also called on the Senate to make the three most pro-growth tax provisions in the tax bill permanent on a deficit-neutral basis instead of temporary, and we identified $470 billion in tax and spending pork that, if removed from the House bill, would precisely cover the cost of permanence.
Now that the Senate tax proposal is public, to what extent does it follow our suggestions? The good news: the Senate scales back some of the more egregious handouts from the House version, and it makes permanent the pro-growth provisions. The bad news: others remain untouched, and some new pork has been added. All in all, the Senate removed or reduced $147 billion in waste from the House bill, retained $32 billion, and added in $186 billion of its own — a net addition of $39 billion in pork.
To the Senate’s credit, several questionable provisions did not survive the red pen. Others were pared back in size or scope but, unfortunately, others were added. Here’s a snapshot of what was removed, reduced, or retained:
TAX PORK REMOVED FROM SENATE BILL
| PROVISION | SAVINGS |
| Tax | |
| Business development corporation income qualifies for the qualified business income deduction | $10,734 |
| Global intangible low-taxed income determined without regard to certain income derived from services performed in the Virgin Islands | $883 |
| Restoration of taxable REIT subsidiary asset test | $3,297 |
| Employer credit for CHOICE arrangement | $492 |
| Individuals entitled to Part A of Medicare by reason of age allowed to contribute to health savings accounts | $4,380 |
| On-site employee clinics | $2,349 |
| Certain amounts paid for physical activity, fitness, and exercise treated as amounts paid for medical care | $10,539 |
| Allow both spouses to make catch-up contributions to the same health savings account | $1,880 |
| Flexible spending account and health reimbursement arrangement terminations or conversions to fund health savings account | $363 |
| Special rule for certain medical expenses incurred before establishment of health savings account | $190 |
| Contributions permitted if spouse has health flexible spending arrangement | $6,819 |
| Increase in health savings account contribution limitation for certain individuals | $8,394 |
| Spending* | |
| Expanding and clarifying the exclusion for orphan drugs under the Drug Price Negotiation Program^ | $4,871 |
| Secure Rural Schools; Forestry | $280 |
| TOTAL | $55,471 |
All values are in millions
Source: JCX-26 – 25R \ *Source: CBO 61461 \ ^Removed due to Byrd rule violation.
PORK REDUCED IN SENATE BILL
| PROVISION | SENATE COST* | MARGINAL SAVINGS^ |
| No tax on overtime (sunset 12/31/28) | -$89,573 | $34,443 |
| No tax on tips (sunsets after 2028) | -$31,664 | $8,017 |
| No tax on auto loan interest (sunset 12/31/28) | -$30,631 | $27,042 |
| Trump accounts and contribution pilot program | -$14,965 | $2,380 |
| Extension and modification of clean fuel production credit | -$25,683 | $19,674 |
| TOTAL | -$192,516 | $91,556 |
All Values in Millions
*Source: JCX-31 – 25
^Calculated by taking the Senate score (JCX-31 – 25) and subtracting the House score (JCX-26 – 25R). See our analysis of the House-passed bill for more.
PORK RETAINED IN SENATE BILL
| PROVISION | COST |
| Tax* | |
| Enhancement of employer-provided child care credit | -$731 |
| Extension and enhancement of paid family and medical leave credit | -$5,454 |
| Enhancement of adoption tax credit | -$2,325 |
| Exclusion for employer payments of student loans | -$11,238 |
| Treatment of certain qualified sound recording productions | -$153 |
| Treatment of direct primary care service arrangements | -$2,811 |
| Allowance of bronze and catastrophic plans in connection with health savings account | -$3,563 |
| Spending (Title I: Committee on Agriculture, Nutrition, and Forestry)^ | |
| Supplemental Agricultural Trade Promotion Program | -$2,191 |
| Research | -$1,608 |
| Energy | -$70 |
| Horticulture | -$332 |
| Miscellaneous | -$1,608 |
| TOTAL | -$32,084 |
All Values in Millions
*Source: JCX-31 – 25 | ^Source: CBO 61533
Even as the Senate cleaned up some provisions, it introduced or expanded others. In several cases, the changes would not work to strengthen the economy.
PORK MADE WORSE IN SENATE BILL
| PROVISION | SENATE COST | MARGINAL COST^ |
| Tax* | ||
| Enhanced deduction for seniors (sunset 12/31/28)** | -$91,217 | -$24,954 |
| Tax credit for contributions of individuals to scholarship granting organizations (credit sunset 12/31/29) | -$26,046 | -$5,604 |
| Permanent and expanded reinstatement of partial deduction for charitable contributions of individuals who do not elect to itemize | -$73,750 | -$66,803 |
| Exclusion of interest on loans secured by rural or agricultural real property | -$2,038 | -$943 |
| Modifications to low-income housing credit | -$15,689 | -$1,579 |
| Spending ^^ | ||
| Crop insurance | -$60,711 | -$8,447 |
| TOTAL | -$208,740 | -$99,883 |
All Values in Millions
*Source: Unless otherwise indicated, figures are from JCX-31 – 25.
** Source: JCX-29 – 25 | ^^ Source: CBO 61533
^ Calculated by taking the Senate score and subtracting the House score. See our analysis of the House-passed bill for more.
NEW PORK IN SENATE BILL
| PROVISION | COST |
| Tax* | |
| Permanent extension of New Markets Tax Credit | -$5,185 |
| Educator expenses as an exception to elimination of itemized deductions** | -$200 |
| Enhancement of advanced manufacturing investment credit | -$8,577 |
| Enhancement of child & dependent care tax credit | -$14,911 |
| Expansion of qualified small business stock gain exclusion | -$17,186 |
| Exceptions from limitations on deduction for business meals | -$948 |
| Enhancement of deduction for qualified business income (including minimum deduction)** | -$5,961 |
| Retroactive research and experimentation expensing for small businesses^ | -$5,220 |
| Restrictions on carbon oxide sequestration credit (45Q) | -$14,228 |
| Permanent extension of safe harbor for absence of deductible for telehealth services | -$4,320 |
| Adjustment of charitable deduction for certain expenses incurred in support of Native Alaskan subsistence whaling | -$5 |
| Spaceports are treated like airports under exempt facility bond rules | -$1,026 |
| Nonprofit community development activities in remote native villages | -$3 |
| Permanent increase in limitation on cover over of tax on distilled spirits | -$1,915 |
| Spending (Title I) ^^ | |
| Economic adjustment assistance for textile mills | -$55 |
| Sugar program updates | -$56 |
| Dairy program updates | -$100 |
| Marketing assistance loans | -$1,969 |
| Supplemental Agricultural Disaster Assistance | -$2,868 |
| Nutrition | -$28 |
| Equitable treatment of certain entities | -$1,269 |
| Adjusted gross income limitation | -$438 |
| Implementation | -$50 |
| TOTAL | -$86,518 |
*Source: Unless otherwise indicated, figures are from JCX-31 – 25.
** Source: JCX-29 – 25 | ^^ Source: CBO 61533
^ Source: Calculated by subtracting the score for permanency in JCT 25 – 0 026 from the permanent, retroactive score in JCX-31 – 25.
The Senate bill may be slimmer in some areas and fatter in others, but on net, it does not make significant progress toward a leaner, more principled tax code. That said, it does succeed in making the most pro-growth elements of the bill permanent, and the Senate should be commended for that.
In Washington, when the House proposes to spend a dollar and the Senate proposes to spend two, it is said they will compromise by spending three. This dynamic makes tax reform difficult: narrow interests remain loud and persistent, while fiscal discipline fades into the background.
When reconciling the House and Senate versions of this bill, Congress prioritize fiscal responsibility and permanence for truly pro-growth tax relief by eliminating pork, whether provided through spending or through the tax code.
