House GOP Eyes Tax Cuts for Wealthy, Medicaid Cuts for Poor

WASHINGTON — Congressional Republicans are considering sweeping tax cuts for corporations and the ultrawealthy while proposing cuts to Medicaid and other programs benefiting low-income Americans, according to a document circulated among House Republicans this month.

The proposals, aimed at offsetting the cost of new tax cuts, include eliminating the federal estate tax, which would cost the government an estimated $370 billion over a decade. The estate tax currently applies only to estates worth more than $14 million, with nearly 30% of the tax paid by the top 0.1% of earners, according to a think tank analysis.

Another proposal would slash the top corporate tax rate from 21% to 15%, fulfilling a campaign promise by former President Donald Trump. However, Vice President JD Vance has previously expressed opposition to further corporate tax cuts, stating that the U.S. is already in line with rates set by the Organization for Economic Cooperation and Development (OECD).

To fund these cuts, House Republicans are eyeing significant reductions to Medicaid, the federal-state health care program for low-income individuals. The proposed cuts could force states to reduce coverage, limit services, or lower reimbursement rates to health care providers, according to an analysis by a health policy organization.

Trump has sent mixed signals on Medicaid, vowing to protect it during a 2023 campaign event but failing to include similar assurances in the GOP platform. The platform explicitly promises not to cut Medicare but remains silent on Medicaid.

Other proposals target tax breaks for families, including the elimination of the child care tax credit, which could save $55 billion over a decade. The plan also proposes ending the “head of household” filing status, which would disproportionately affect single parents, particularly women, and raise nearly $200 billion in additional taxes.

Democrats have criticized the proposals as favoring the wealthy at the expense of working-class families. “Republicans are gearing up for a class war against everyday families in America,” said Sen. Ron Wyden, D-Ore.

Some proposals align with Trump’s campaign promises, such as eliminating taxes on tips and overtime pay. However, economists have questioned the fairness and efficiency of these measures, arguing they could complicate tax reporting and benefit specific groups of workers over others.

One of the most significant revenue-raising proposals would eliminate the mortgage interest deduction, a tax break primarily benefiting upper-income Americans. The change would disproportionately impact residents of Democratic-leaning states like California, Massachusetts, and New Jersey.

A White House spokesperson declined to comment on specific proposals but emphasized ongoing negotiations with Congress. A House Budget Committee spokesperson described the document as a “menu of policy options” for consideration during the reconciliation process.