What’s Inside Trump’s Sweeping Tax, Spending Overhaul Bill

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What’s Inside Trump’s Sweeping Tax, Spending Overhaul Bill/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ President Trump’s $4.5 trillion “big beautiful bill” passed Congress, locking in major tax cuts and reshaping federal spending. The nearly 900-page law slashes green energy credits, cuts social programs, and expands defense and immigration spending. Critics warn it adds $3.3 trillion to the deficit while favoring the wealthy.

Republican members of Congress reach to shake hands with Speaker of the House Mike Johnson, R-La., center bottom, after Johnson signed President Donald Trump’s signature bill of tax breaks and spending cuts, Thursday, July 3, 2025, at the Capitol in Washington. (AP Photo/Julia Demaree Nikhinson)

Quick Look: Trump’s Big Beautiful Bill

Locks in $4.5 trillion in tax cuts
Cuts Medicaid, SNAP, and green energy credits
Adds billions for defense, border wall, ICE hiring
Ends EV tax credits early
Establishes “Trump Accounts” for kids’ savings
Funds a National Garden of American Heroes
Could raise deficit by $3.3 trillion
AI regulation ban dropped after GOP revolt

Trump’s “Big Beautiful Bill” Passes Congress: What’s Inside the Sweeping Law

Deep Look

WASHINGTON (AP) — President Donald Trump’s massive tax and spending plan is heading to his desk after House Republicans pushed the nearly 900-page bill over the finish line Thursday. The legislation, which Trump calls his “one big beautiful bill,” delivers tax cuts, spending changes, and sweeping shifts to domestic policy.

The final House vote was 218-214, after weeks of drama and political brinkmanship. Two Republicans joined Democrats in opposition, but GOP unity carried the day. The Senate passed the measure earlier in the week, with Vice President JD Vance breaking a tie.

Here’s a breakdown of what’s in the bill and how it could reshape American life.

Big Tax Cuts for Individuals and Businesses

The bill cements about $4.5 trillion in tax cuts, making permanent the tax rates and brackets from Trump’s first term that were set to expire after this year.
Workers will be able to deduct tips, overtime pay, and auto loan interest temporarily.
Older adults earning up to $75,000 can claim a new $6,000 deduction.
The child tax credit rises slightly from $2,000 to $2,200, but lower-income families won’t fully benefit due to income limits.
The cap on state and local tax (SALT) deductions jumps to $40,000 for five years, a relief for taxpayers in high-tax states.
Businesses get significant relief, including 100% bonus depreciation for equipment and research costs.

Impact: The Congressional Budget Office (CBO) estimates wealthy households will save around $12,000 annually under the new law. Meanwhile, lower-income Americans could see costs rise by $1,600 yearly due to cuts in safety net programs.

Billions for Defense, Border Security, and Deportations

About $350 billion goes to national security, border security, and the military.
Funding includes:
- Building the U.S.-Mexico border wall.
- Expanding migrant detention capacity to 100,000 beds.
- Hiring 10,000 new ICE agents and surging Border Patrol ranks.
- Developing the “Golden Dome” missile defense shield with a $25 billion investment.
New fees will hit immigrants seeking asylum or legal status to help offset costs.

Deep Cuts to Medicaid and Food Assistance

To help pay for tax cuts and new spending, the bill imposes significant reductions in social programs:

New 80-hour-per-month work requirements for many adults on Medicaid and SNAP (food stamps), including parents of children as young as 14.
Medicaid patients could face new $35 co-pays.
States will be forced to share costs of SNAP benefits if they have high error rates in payments.
The CBO projects:
- 11.8 million more Americans could become uninsured by 2034.
- About 3 million fewer people may qualify for SNAP.

Rollbacks for Clean Energy Incentives

The bill guts major green energy tax credits from President Biden’s Inflation Reduction Act.
The $7,500 federal credit for electric vehicles will expire on Sept. 30, years earlier than scheduled.
Wind and solar industries warn of job losses and higher consumer costs.
A tax credit for critical minerals used in manufacturing will expand to include metallurgical coal.

Other Key Provisions in the Bill

Establishes “Trump Accounts,” children’s savings accounts with potential $1,000 contributions from the U.S. Treasury.
Funds Trump’s long-promised National Garden of American Heroes with $40 million.
Eliminates a $200 tax on gun silencers and certain short-barreled firearms.
Imposes a new tax on university endowments and a 1% tax on money transfers sent abroad.
Bars Medicaid payments for one year to abortion providers like Planned Parenthood.
Expands compensation for victims of nuclear testing under the Radiation Exposure Compensation Act.
Provides billions for NASA’s Artemis moon program and Mars exploration.
Increases the national debt limit by $5 trillion to accommodate federal borrowing.

AI Moratorium Dropped Amid GOP Revolt

The bill initially contained a controversial provision to block state-level regulation of artificial intelligence for a decade. After fierce pushback from Republican governors and lawmakers concerned about Big Tech’s influence, the Senate stripped the AI moratorium in a 99-1 vote.

Billions for Rural Hospitals

In a late deal to secure votes, the bill allocates $50 billion over five years to support struggling rural hospitals. Initially, the Senate version offered half that amount. The change was crucial to winning over senators worried about Medicaid cuts harming rural care.

So What’s the Final Price Tag?

CBO Estimate: The bill could increase deficits by $3.3 trillion over the next decade.
GOP’s Accounting View: Senate Republicans argue the cost is lower because they don’t count extending existing tax cuts as “new spending,” claiming the bill could even reduce deficits by nearly $500 billion.

Democrats dismiss the GOP math as budgetary “smoke and mirrors,” warning it masks the bill’s real fiscal impact.