 "Speaker of the House Mike Johnson, R-La, surrounded by Republican members of Congress, signs US President Donald Trump's signature bill of tax breaks and spending cuts, July 3, 2025, at the Capitol in Washington, DC, US. File Image/AP")
The United States Congress has approved a massive Republican-authored legislative package combining trillions in tax cuts amid sweeping spending reductions, and broad policy shifts across national security, social welfare, and energy sectors, in a big win for US President Donald Trump.
Nicknamed the “One Big Beautiful Bill” by Trump and GOP leaders, the legislation passed the House narrowly on Thursday, just in time to meet the Republicans’ self-imposed July 4th deadline.
At 218–214, the final House vote highlighted sharp divisions, with two Republicans breaking ranks to oppose the bill and all Democrats voting against it.
In the Senate, the tie-breaking vote came from US Vice President JD Vance, securing the bill’s path to Trump’s desk for signing.
The legislative process leading up to the bill’s passage was anything but smooth. House Republican leaders worked through the night to consolidate support, and Trump personally intervened to bring sceptics on board.
Democratic Leader Hakeem Jeffries mounted an hours-long floor speech in a last-ditch effort to delay the vote, delivering what is now the longest speech in House history.
Despite these obstacles, the bill was passed and celebrated by Trump during a public event in Iowa, coinciding with the launch of events marking America’s upcoming 250th anniversary.
“I want to thank Republican congressmen and women, because what they did is incredible,” Trump said. He added, “They hate Trump — but I hate them too.”
The US president confirmed that he would sign the bill into law on Friday at the White House.
“With one big beautiful bill we are going to make this country stronger, safer and more prosperous than ever before,” said House Speaker Mike Johnson, R-La., following the vote.
Republicans marked the occasion by playing “Y.M.C.A.”, a track famously featured at Trump’s rallies, in a celebratory ceremony.
Who wins & who loses in Trump’s “One Big Beautiful Bill”
At nearly 900 pages, the bill serves as a Republican wishlist comprising tax reforms, business-friendly provisions and social programme overhauls.
Tax reforms and deductions
The legislation enacts permanent extensions of tax cuts originally passed during Trump’s first term. Without this, those cuts were due to expire at the end of this year. The bill includes:
About $4.5 trillion in tax cuts
A $6,000 deduction for seniors earning below $75,000
Boosting the child tax credit from $2,000 to $2,200, though low-income families would not receive the full benefit
Temporary deductions for tips, overtime wages, and auto loan interest
For businesses, the package includes:
Full, immediate expensing of capital equipment and research investments
Expanded deductions on business purchases
Elimination of a proposed new tax on renewable energy projects using components from China
Affluent households are set to benefit significantly, with the wealthiest gaining around $12,000, while lower-income households could lose up to $1,600 per year — mainly due to reductions in public assistance programmes.
According to the US Congressional Budget Office (CBO), the combined changes would raise the federal deficit by nearly $3.3 trillion over a decade (2025–2034).
However, Senate Republicans dispute that number, arguing the bill should not be scored as new spending since many tax cuts represent “current policy.”
They claim the bill reduces deficits by $500 billion, a view the Committee for a Responsible Federal Budget criticises as “an accounting gimmick that would make Enron executives blush.”
Medicaid cuts & SNAP restructured
To compensate for revenue losses from tax cuts, the bill imposes major reductions in Medicaid and food assistance (SNAP):
New 80-hour-per-month work requirements for most non-disabled adults, including those aged up to 65
Parents of children aged 14 and older must meet work criteria to receive aid
A $35 co-payment for Medicaid-covered services
States with high SNAP error rates must contribute financially starting 2028
A controversial provision forcing states to help pay for SNAP benefits was modified after US Senator Lisa Murkowski, R-Alaska, negotiated a delay in implementation. Alaska has the highest error rate at nearly 25 per cent, per the Department of Agriculture.
CBO projections indicate that by 2034, these changes could result in:
11.8 million more people without health insurance
3 million fewer individuals qualifying for SNAP benefits
Although GOP lawmakers argue the changes target waste, fraud and abuse, critics note most SNAP recipients already work and warn that the plan disproportionately impacts the poor.
Billions allocated in border security, deporations & defence
A major section of the bill funds Trump’s immigration enforcement and national defence agenda. Around $350 billion is set aside for:
Continuing construction of the US-Mexico border wall
Establishing 100,000 migrant detention beds
Hiring 10,000 new ICE officers with $10,000 signing bonuses
A massive deportation operation with a target of 1 million removals per year
Immigrants would also face new fees, including for asylum applications.
In defence spending:
$25 billion is directed toward the Golden Dome missile shield programme
Additional funds support shipbuilding, munitions production, and military personnel welfare
$1 billion will be spent on border security by the US Department of Defence
Rollback of clean energy support, EV credits slashed
One of the bill’s most contentious elements is the repeal of several clean energy tax credits introduced during the Biden administration. These include:
Early expiration of electric vehicle (EV) purchase credits by September 30
Elimination of multiple solar and wind incentives
Democratic Senator Ron Wyden of Oregon called the provisions a “death sentence for America’s wind and solar industries and an inevitable hike in utility bills.”
In contrast, the bill expands a tax credit for metallurgical coal, used in steel manufacturing, reflecting a broader GOP pivot toward traditional energy.
Trump accounts, Space, AI and a Hero Garden
Beyond core economic and defence issues, the bill includes numerous standalone provisions:
Creation of “Trump Accounts” — a new children’s savings programme seeded with up to $1,000 from the Treasury
Allocation of $40 million for a National Garden of American Heroes
Funding for Nasa’s Artemis moon mission and future Mars exploration
$88 million for the Pandemic Response Accountability Committee
Extension of the Radiation Exposure Compensation Act, pushed by Senator Josh Hawley
The bill also removes a controversial federal moratorium on state regulation of artificial intelligence following overwhelming bipartisan opposition in the Senate (99–1 vote).
To address GOP concerns about rural health access, a last-minute amendment boosted funding for rural hospitals to $10 billion annually for five years, totalling $50 billion — double the original Senate proposal.
In fiscal terms, the bill raises the debt ceiling by $5 trillion, authorising new borrowing to service existing commitments.
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With inputs from agencies