House Republicans have passed a sweeping multi-trillion-dollar tax breaks package, a narrow victory for President Donald Trump and House Speaker Mike Johnson after weeks of negotiations with conservative holdouts.
Trump’s “big, beautiful bill” passed with a vote of 215 votes to 214, with two Republicans joining Democrats to oppose it and one voting present.
It now heads to the Senate, which will have the chance to approve or change provisions of the bill.
The US President’s allies on Capitol Hill have celebrated its passage as a victory, with Johnson saying it “gets Americans back to winning again”.
Long a policy priority of Trump’s, the legislation extends soon-to-expire tax cuts passed during his first administration in 2017, as well as provides an influx of money for defence spending and to fund the president’s mass deportations.
It also temporarily eliminates taxes on overtime work and tips – both key promises Trump made during his successful 2024 presidential campaign.
“What we’re going to do here this morning is truly historic, and it will make all the difference in the daily lives of hard working Americans,” Johnson said on the floor before the vote.
Additionally, the bill makes significant spending cuts, including to the Medicaid healthcare programme for lower-income Americans as well as Snap, a food assistance programme used by more than 42 million Americans.
These cuts were the subject of intense friction among Republicans, which was finally overcome after the President travelled to Capitol Hill on Tuesday. He privately told lawmakers to put aside their objections or face consequences.
Democrats also fiercely opposed the bill and warned that the cuts could have dire consequences for millions of lower-income Americans.
“Children will get hurt. Women will get hurt. Older Americans who rely on Medicaid for nursing home care and for home care will get hurt,” Minority Leader Hakeem Jeffries, a New York Democrat, said on the House floor.
“People with disabilities who rely on Medicaid to survive will get hurt. Hospitals in your districts will close. Nursing homes will shut down,” he added. “And people will die.”
The next day, a statement from the White House warned that the administration would see a failure to pass the bill as the “ultimate betrayal”.
The legislation, however, comes with a massive price tag. It is estimated to add $5.2tn (£3.9tn) to US debt and increase the budget deficit by about $600bn in the next fiscal year.
Those eye-popping figures – and the prospect of ballooning interest payments on the debt – were among the reasons that financial rating agency Moody’s downgraded the US credit rating last week.
The lengthy document of over 1,000-pages was released just hours before lawmakers were asked to vote on it, meaning there could be other provisions and line items yet to be discovered.
The Senate must also approve the bill and could make some changes in the process. If lawmakers there do, it will return to the House for another high-stakes vote with potential to go wrong.
On Truth Social, Trump urged the Senate to send the bill to his task “as soon as possible”.
One of the first items senators will have to tackle is a report from the Congressional Budget Office that the debt increase in the House bill would trigger a provision of a 2011 law that mandates approximately $500bn in spending cuts to Medicare, the health insurance programme for the elderly.
Trump had pledged not to touch that popular government service – and Republicans would likely face a political price if they don’t tweak the rules to avoid the mandatory reductions.
Democrats are pledging to use today’s vote against Republicans in next year’s midterm congressional elections, highlighting other spending cuts – including to the low-income health insurance programme, government research and environmental spending – and tax reductions for the wealthy.
Even Congressional Republicans celebrate a win, the narrowness of the Republican House majority is vulnerable to even small shifts in public sentiment. The midterms could flip control of that chamber to the Democrats and grind Trump’s legislative agenda to a halt.
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