The House on Thursday approved legislation that would allow combat-wounded veterans who were medically retired to receive both their full military retirement pay and disability compensation, eliminating a long-standing offset that critics have called the "wounded veteran tax."
The bill, known as the Major Richard Star Act, passed by a vote of 392-18 after Democrats used a discharge petition to force a floor vote, bypassing committee delays. The measure now heads to the Senate, where fiscal conservatives have previously raised concerns about its cost.
Under current federal rules, veterans who retire early due to combat-related injuries see their retirement pay reduced dollar-for-dollar by the amount of disability compensation they receive. Supporters argue this penalizes those who served in combat and were forced out of the military due to their injuries.
Representative Raul Ruiz (D-Calif.), a co-author of the bill, said in a statement: "Combat-wounded veterans who were forced to medically retire are being shortchanged by the VA. For every dollar in VA disability compensation these veterans receive, a dollar is taken out of their retirement pay." He added: "Our veterans deserve respect, they do NOT deserve to be treated like a burdensome, expendable line item in a budget."
The legislation is named after Major Richard Star, a U.S. Army combat engineer who died of cancer linked to toxic burn pit exposure. It was originally introduced in 2023 and has drawn support from major veterans' organizations.
House Veterans Affairs Committee ranking member Mark Takano (D-Calif.), who championed the discharge petition, said on the floor Wednesday that it is "far past time for us to end the wounded warrior tax and to give our combat wounded veterans the compensation they have earned."
Co-author Gus Bilirakis (R-Fla.) did not sign the discharge petition, instead backing a broader Republican package, the Take Care of America's Veterans Act (TCAVA), which passed the House by voice vote on Wednesday. Democrats oppose TCAVA, arguing it would expand some benefits by cutting others. Bilirakis has praised the inclusion of the Star Act in that package.
The Star Act received a boost earlier this year when Defense Secretary Pete Hegseth endorsed it. However, Senate passage remains uncertain, as some conservative lawmakers have questioned the lack of spending offsets. The bill's fate now rests with the Senate, where similar efforts have stalled in the past.
Proponents of the measure say it is a matter of fairness for veterans who sacrificed their health in service. Opponents worry about the fiscal impact, but supporters note that the number of affected veterans is relatively small and that the cost is a moral obligation to those who served.
