Debt ceiling likely to be raised, spending to be capped for two years – reports

By Jordan On May 26, 2023

American Politics - Stimulus Bill and infrastructure — Douglas Rissing/iStock via Getty Images

Debt talks appear to be nearing the end amid reports that a potential deal would raise the U.S. government’s $31.4T debt ceiling and limit spending on most items for two years.

Republican negotiators have reportedly agreed for a smaller 3% increase in defense spending. Non-defense discretionary spending is expected to be maintained at current levels.

The White House is mulling cutting back on increased funding for the Internal Revenue Service, Reuters reported, citing an unnamed official.

The deal would cut $10B from an $80B budget increase for the IRS that was planned under the Inflation Reduction Act to target wealthy individuals, Bloomberg reported, citing unnamed sources.

Earlier on Thursday, U.S. Representative Kevin Hern (R-Oklahoma), who leads the largest Republican caucus, said a deal is “likely” by Friday afternoon.

In the meantime, the Biden administration is said to be considering a 2011-era contingency plan, under which payments would be made to the Treasury no sooner than the day before they’re due.

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