President Donald Trump still needs to sign the bill, and he might not do so until the new year. That’s for one reason: to avoid a massive $25 billion cut to Medicare.
The cut would come from the Pay As You Go Act, or PAYGO. The rule requires that any substantial increase in the deficit from a bill must be offset by reduced spending elsewhere. If no offsets are included in the bill, automatic cuts kick in when the deficit starts to grow.
The biggest of these cuts would come in Medicare. According to the CBO, if the tax bill is signed into law in 2017, a $25 billion offsetting cut to Medicare in 2018 would result. The rest of the $150 billion in cuts would come from things like border security and farm subsidies.
January 3 is the latest date Trump could sign the bill without what is known as a pocket veto going into effect. A pocket veto occurs if a president does not sign a bill for 10 days, not including Sundays or federal holidays.
If Trump does not sign the bill by then, it would be considered vetoed, and another vote would be needed in Congress. That vote, however, would require the support of two-thirds of the House and Senate members, which would doom the bill.
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