Congressional Republicans are racing to push forward a sweeping bill that encapsulates President Donald Trump’s key campaign pledges, including hefty tax reductions, slashed federal spending, and bolstered border security measures. Dubbed the “one, big, beautiful bill” by GOP leaders in a nod to
Trump’s flair, the legislation is being crafted with urgency, with House Speaker Mike Johnson aiming to pass it and send it to the Senate by late May. Below is a breakdown of the bill’s major components based on current details:
Tax Relief for Individuals and Corporations
The tax segment of the bill proposes over $5 trillion in tax cuts, though spending reductions and tax code tweaks offset some of this, bringing the net cost to roughly $3.7 trillion, according to the Joint Committee on Taxation. Key features include:
•Permanent Tax Cuts: Extending the individual income tax reductions from Trump’s first term.
•Campaign Promises: Exempting tips, overtime pay, and auto loan interest from taxation, with the latter limited to vehicles assembled in the U.S. and capped at $10,000, expiring at the end of Trump’s term.
•State and Local Tax (SALT) Deduction: Increasing the SALT deduction cap from $10,000 to $30,000 for households earning under $400,000 annually, with New York lawmakers pushing for further expansion.
•Tip Income Relief: A deduction for service industry workers reliant on tips.
•Senior Benefits: A $4,000 deduction on Social Security wages for seniors with incomes up to $75,000 (individuals) or $150,000 (couples).
•Clean Energy Rollback: Eliminating Biden-era clean energy incentives, like the $7,500 electric vehicle credit, to help fund the tax cuts.
The tax provisions are still evolving, with more adjustments expected soon.
Shifting SNAP Costs to States
The bill restructures the Supplemental Nutrition Assistance Program (SNAP), requiring states to cover 5% of benefit costs starting in 2028, with higher contributions for states with significant payment errors. States would also bear 75% of administrative costs, up from the current 50%. Republicans argue this incentivises efficiency, but critics warn it could strain state budgets. The bill expands work requirements for SNAP recipients, extending the age limit from 54 to 64, with exemptions for those caring for children under 7. Additionally, it allocates $60 billion to support farmers through agricultural programs.
Medicaid Overhaul and Spending Cuts
The legislation targets over $900 billion in savings, primarily through Medicaid reforms. Republicans frame these as efforts to eliminate inefficiencies, but Democrats warn that the changes could strip coverage from millions. The Congressional Budget Office estimates at least 7.6 million people could lose Medicaid due to:
Work Requirements: A new mandate for able-bodied adults without dependents to engage in 80 hours of monthly work, education, or community service, effective January 2029.
Stricter Eligibility: Requiring twice-yearly eligibility verification and barring those with homes valued over $1 million.
Additional Affordable Care Act changes could further reduce coverage.
Border Security and Immigration Crackdown
The bill allocates $69 billion for immigration enforcement, including:
Border Wall and Deportations: $46.5 billion to resume border wall construction and fund the deportation of 1 million migrants annually, with $4 billion to hire 3,000 Border Patrol agents, 5,000 customs officers, and 10,000 ICE personnel.
Asylum Fee: A novel $1,000 fee for asylum seekers, aligning the U.S. with countries like Australia.
Detention Expansion: Funding to detain 100,000 migrants in detention centres.
Defence and National Security Boost
The bill includes $150 billion for defence, surpassing the initial $100 billion target. Highlights include:
Missile Defence: $25 billion for Trump’s “Golden Dome” missile shield.
Military Investments: $34 billion for naval expansion, $21 billion for ammunition restocking, and $9 billion for servicemember housing, healthcare, and pay.
Border Security: An additional $5 billion for border-related efforts.
Student Loan and Endowment Changes
The bill overhauls student loans, saving $330 billion by:
Simplifying Repayment: Replacing existing plans with a standard 10- to 25-year option and a less generous “repayment assistance” plan.
Repealing Protections: Eliminating Biden-era rules that eased loan forgiveness for defrauded or displaced students.
Endowment Tax: Imposing up to a 21% tax on certain university endowments.
Federal Pension Reductions
The bill cuts $50.9 billion from federal employee pensions by requiring pre-2014 hires to contribute 4.4% of their salaries to retirement funds, matching newer employees’ rates.
Expanded Resource Extraction
The legislation promotes drilling, mining, and logging on public lands by:
Lower Royalties: Reducing oil and gas royalties to 12.5% and coal to 7%.
Arctic Leasing: Mandating four oil and gas lease sales in the Arctic National Wildlife Refuge over a decade.
Coal Industry Support: Opening 6,250 square miles of public land for coal leasing.
Land Sales: Authorizing the sale of vast public lands in Nevada and Utah, sparking environmentalist backlash.
At a rally marking his first 100 days in office, Trump touted the tax legislation as a vital boost for growth, saying the “big beautiful tax bill” would be “rocket fuel for the economy.”
