Introduction
President Donald Trump tax bill heavily-endorsed tax and spending package — dubbed the “Big, Beautiful Bill” — has passed the House and is under Senate review. With provisions aimed at cutting taxes, tightening welfare eligibility, and repealing clean energy credits, the bill could reshape U.S. domestic policy. Senate Republicans are racing to finalize their version before the July 4 deadline.
Key Elements of the Bill
No Tax on Social Security & Retirement Relief
Trump’s promise to eliminate taxes on Social Security income remains central. The House version falls short, offering a temporary $4,000 deduction (2025–2028) for individuals 65 and older. The Senate plan expands it to $6,000, with phase-outs starting at $75,000 individual income.
Increased Medicaid Work Requirements
To offset tax cuts, Republicans proposed strict new Medicaid eligibility rules. Childless adults must work at least 80 hours/month, and re-enrollment becomes biannual. Senate Republicans go further, cutting provider tax limits and extending work rules to parents with children aged 14+.
These changes would likely cause millions to lose coverage.
Higher SALT Cap for Some
The House bill raises the SALT (State and Local Tax) deduction cap from $10,000 to $40,000 for couples earning under $500,000. However, the Senate aims to retain the $10,000 cap permanently, a key point of contention.
👉 See full House vs Senate comparison
Changes to SNAP Benefits
The bill introduces work requirements for able-bodied SNAP (food stamp) recipients without dependents and shifts more funding responsibility to states. Critics argue this could reduce access for over 40 million Americans relying on food aid.
No Tax on Tips or Overtime Pay
The House version eliminates taxes on overtime and tip income — a major Trump campaign pledge. The Senate version allows deductions but phases them out above $150,000 income thresholds.
New Car Loan Deduction & Child Tax Credit
- Interest on U.S.-made car loans becomes deductible
- Child tax credit rises from $2,000 to $2,500 (House)
- Senate version: makes credit permanent but sets it at $2,200
Raising the Debt Ceiling
The bill proposes raising the debt ceiling by $4 trillion (House) or $5 trillion (Senate). This would help fund existing programs and new tax cuts.
👉 Read the full CBO analysis here
Clean Energy Rollback
Both chambers aim to end Biden-era green energy credits. The House wants an immediate rollback, while the Senate proposes a slow phase-out until 2028.
Senate credits would decline as follows:
- 100% credit: Projects begun in 2025
- 60% credit: 2026
- 20% credit: 2027
👉 Read about fossil fuel influence behind the rollback
Internal Politics & Pushback
Senate Republicans are deeply divided. Some, like Rep. Mike Lawler (R-NY), say the SALT cap is a deal-breaker. Meanwhile, others criticize the softening of green energy rollbacks.
👉 Read full internal politics breakdown
Conclusion
The “Big, Beautiful Bill” represents a seismic shift in U.S. tax and spending policy. With billions in tax cuts and tightened welfare, it echoes Trump-era conservative priorities. However, deep Republican divides and Democratic resistance may challenge its passage before July 4. Americans should stay informed as negotiations evolve in Congress.
