The Trump party unilateral control of Washington has not passed legislation on his campaign promise of no tax on overtime, yet and things are a little complicated.
The Republican controlled House of Representatives passed a massive budget bill in February with Trump’s top priorities including no tax on overtime which he promises on the campaign trail.
The bill was then sent to Senate where Republicans are also in charge. In the upper chamber, Republicans approved amendments to the House passed bill on April 5 on a 51-48 vote (Sens. Susan Collins, R-Maine and Rand Paul, R-Kentucky, joined every Democrat to vote against it) and sent it back to the House.
This is where things get complicated.
The bill includes Trump’s major campaign promises, not just no tax on overtime and some Republicans are opposed to some of these measures.
For instance, far-right Republicans are demanding a $2 trillion federal spending cut which the Senate rejected. Meanwhile, moderate Republicans are concerned about calls for a $880 billion cut to programs like Medicaid and SNAP.
A House vote on the complete package was canceled on Wednesday as some Republicans rebel. House Speaker Mike Johnson (R-La.) will try to pass the Senate amended bill again on Thursday.
Adoption of identical budget resolutions in both the House and Senate is an essential step to allowing committees to start drafting and passing the party-line package.Â
It is also worth noting that any changes made to the Senate bill in the House will result in the bill being sent back to the Senate which could potentially result in a protracted process to get the bill to Trump’s desk when he could sign measures like no tax on overtime into law.
All this is happening while economists are warning that no tax on overtime is a bad idea and would potentially open a tax loophole for wealthy individuals to game the system.
The Economic Policy Institute explains:
Lower-paid salaried workers could also easily be used to give tax breaks to highly paid salaried workers, who already expect to work long hours. Any hourly, W-2 worker is eligible for overtime, no matter how much they earn. Employers could switch a highly paid executive to an hourly status and set their hourly wage so that, with overtime, they are being paid the same pre-tax salary as before—giving them an enormous tax windfall….it’s easy to imagine a corporate CEO being paid a $4,000 hourly wage and earning $6 million in overtime, which would not be taxed.
