A key House committee advanced President Donald Trump’s giant tax and spending package after Republican hardliners won agreement from party leaders to speed up cuts to Medicaid health coverage.

The vote in the House Budget Committee paves the way for passage of the legislation as soon as Thursday, House Republican leadership aides said Monday. 

The late Sunday night committee vote followed a weekend of negotiations with four ultraconservatives on the panel who on Friday joined with Democrats to reject the legislation. Those hardliners instead abstained on Sunday and voted present, allowing the bill to advance.

Representative Chip Roy of Texas, one of the four hardliners, said party leaders agreed to move up Medicaid work requirements expected to kick millions of beneficiaries off the health coverage program and more quickly phase out clean energy tax breaks.

But Roy still expressed dissatisfaction, saying the measure “does not yet meet the moment.” Roy and the House Freedom Caucus said in posts on X they are hoping to win additional cuts before the bill comes up for a vote on the House floor.

Budget Committee Chairman Jodey Arrington said he didn’t know what changes the party leaders had agreed to make. The changes will be added later, before the legislation is voted on by the full House.

House Speaker Mike Johnson told reporters “there’s a lot more work to do” on the tax bill but said he would push on Medicaid work requirements “to make it happen sooner, as soon as possible.” 

On Monday, House Majority Leader Steve Scalise told CNBC that work requirements would start in 2027, two years earlier than the timeframe in the draft legislation. But the Republican leadership staff later said that the date has not yet been settled.

Republicans broadly agree about imposing work requirements on Medicaid, the leadership aides told reporters. The discussion is around the start date, the people said. Republicans are also continuing to discuss the cap on the state and local tax deduction and when clean energy credits will phase out, they said.

There is strong support among Republicans for the tax cuts at the core of the package, providing an impetus to work out political differences.

But the House panel’s initial rejection of the legislation and the two-day impasse was an embarrassing setback for Republican leaders on their top legislative priority, highlighting ferocious infighting among party factions over components of the sprawling multi-trillion dollar fiscal package.

Trump fulminated against the ultraconservatives on social media Friday after they blocked the legislation, accusing them of “grandstanding” demands.

“It’s essential that every Republican in the House and the Senate unites behind President Trump and passes this popular and essential legislative package,” White House Press Secretary Karoline Leavitt told reporters Monday morning.

She added that Trump plans to be “very engaged” as the bill moves through Congress and will likely call members directly if they are waffling on their support for the bill.

More turbulence may lay ahead as the legislation proceeds toward a vote by the full House and then consideration in the Senate, where the deeper Medicaid cuts the hardliners demanded as well as other provisions face scrutiny, if not outright opposition.

Republicans from high-tax states such as New York, New Jersey and California have threatened to defeat the legislation unless they get a higher limit on the federal income tax deduction for state and local taxes. 

Deficit worries and long-term interest rates approaching 5% have enhanced a campaign by the party’s right flank to seek deeper cuts to government spending. Those concerns were highlighted on Friday evening when Moody’s lowered the U.S. credit rating to Aa1 from Aaa.

If the House does pass a version of their bill, more obstacles await in the Senate.

Senator Josh Hawley, a Missouri Republican, has said he would not vote for the House measure’s cuts to Medicaid benefits and points to cutting prescription drug prices as a better way to gain savings.

The bill’s Medicaid cuts could also face skepticism from moderate Republicans, including Susan Collins of Maine and Lisa Murkowski of Alaska — who helped defeat Trump’s effort to repeal the Affordable Care Act in 2017. 

Still other senators, including Thom Tillis of North Carolina, whose state has billions in green energy projects already built or in the works, want a more gradual phase-out of Biden administration clean-energy tax incentives.

As initially unveiled by House Republicans, many clean energy credits would begin to phase out in 2029.

The tax breaks, which include incentives for wind and solar power, nuclear power and other sources of clean energy, have been ripe targets for lawmakers looking to offset the cost of extending Trump’s cuts.

Others, like the tax credit for electric vehicles, would in most cases phase out starting at the end of 2025.

EY continued to audit NMC Health Plc despite suspicions that management withheld key documents that revealed its true debt position, lawyers for the collapsed firm argued at the start of a £2 billion ($2.7 billion) London trial.

NMC’s administrator, Alvarez & Marsal, sued EY in London alleging negligence and failure to spot the billions of hidden debt between 2012 and 2018 when EY was the auditor. NMC was put into administration in 2020 following allegations of fraud at the health care provider. 

“It is remarkable that, despite its suspicions that management was lying about being unable to provide access to the group’s general ledger, EY continued to conduct the audits,” lawyers for NMC said on the first day of the London trial. 

EY denies the allegations and said the claims were “unfounded.” “Even a bloodhound was likely to be deceived in this case, let alone a competent watchdog,” lawyers for the audit firm said in court filings.

The collapse of NMC sparked a flurry of lawsuits and investigations in the U.K. and U.S. as different sides point the finger of blame. The U.K.’s markets watchdog previously censured the fallen Middle Eastern hospital operator, saying the once-FTSE100 listed firm misled investors about its debt position by as much as $4 billion.

NMC’s case is “enormously inflated” and the “true losses, if any, are far less than its headline claim,” lawyers for EY said in court filings. “NMC’s pleaded case depends on both an exaggerated conception of the scope of EY’s duty and an unrealistic premise as to how auditors faced with challenging client circumstances should behave.”

The health care company was put into administration in 2020 by a London court as the scale of the firm’s troubles emerged following a short seller’s report. 

“This was a complex, pervasive and collusive fraud, and responsibility for it lies squarely with its perpetrators, including NMC’s owners, directors and the treasury and finance team,” EY’s spokesperson said in a statement.

The firm’s founder Bavaguthu Raghuram Shetty, who is not a party to the case, has previously denied any wrongdoing saying he was a victim of the fraud. Shetty, who was sued separately by NMC, blamed former senior executives and EY for the alleged fraud. Shetty’s lawyers didn’t immediately comment on the trial.

EY agreed to remove auditors who sought more information from NMC, replacing them with people “hand-picked” by the collapsed hospital operators’ top shareholders, lawyers for NMC alleged.

The auditor was the victim of “active concealment” of the fraud and it had risen to the challenges posed by “bombastic style” of functioning by the majority shareholders’ representative on the firm’s board, according to EY’s lawyers.

Al Drago/Bloomberg

The week before confirmation hearings for President Donald Trump’s nominee for commissioner of the Internal Revenue Service, former Missouri Congressman Billy Long, Democrats in the Senate are asking questions about the timing of campaign donations he received immediately after his nomination.

In a letter sent last Thursday to seven different companies — including an accounting firm, a tax advisory services firm, and a financial services provider — Democratic Senators Elizabeth Warren, D-Massachusetts, Ron Wyden, D-Oregon, and Sheldon Whitehouse, D-Rhode Island, questioned donations that the companies and some of their employees made to Long in the month and a half after his nomination in early December of 2024.

Between Dec. 4, 2024, and the end of January 2025, the letters said, Long’s unsuccessful 2022 campaign for Senate received $165,000 in donations — after nearly two years without receiving any — and his leadership PAC received an additional $45,000.

The donations allowed Long to repay himself the $130,000 balance of a $250,000 loan he had personally made to his campaign back in 2022.

(Read more: “DOGE downsizing, IRS commissioner switch complicate tax season.“)

The senators’ letters described the donations as “a highly unusual and almost immediate windfall,” and characterized many of the donors as being “involved in an allegedly fraudulent tax credit scheme.”

“The overlap between potential targets of IRS investigations and the list of recent donors heightens the potential for conflicts of interest and suggests that contributors to Mr. Long’s campaign may be seeking his help to undermine or avoid IRS scrutiny,” the letters said; adding, “This brazen attempt to curry favor with Mr. Long is not only unethical — it may also be illegal.”

The senators then warned, “There appears to be no legitimate rationale for these contributions to a long-defunct campaign other than to purchase Mr. Long’s goodwill should he be confirmed as the IRS commissioner,” before appending a list of approximately a dozen questions for the donors to answer.

The donations were originally discovered in early April by investigative news outlet The Lever, which the senators noted in their letters.

After Long left Congress in 2023, he worked for a tax consulting firm, including promoting the COVID-related Employee Retention Credit. In early January, Sen. Warren sent a letter to Long questioning his tax credentials and promotion of the ERC.

The IRS has run is now on its fifth acting or regular commissioner since President Trump announced his intention to nominate Long; a number of the commissioners resigned or were removed over policy differences with the administration and its Department of Government Efficiency.

Long’s confirmation hearing before the Senate Finance Committee is scheduled for this Tuesday, May 20.