Apart from gathering enough views on the recent tug of war between the President Donald Trump and Elon Musk, X (formerly Twitter) is now making shockwaves on the recent bill which Trump has described as a one “Big Beautiful Bill”. Touted as revolutionary for some and useless for the others, this bill is aiming to shake up the big plan to change the functioning of the prominent systems, such as taxes, healthcare, and government expenditures in the U.S. While there is a talk of the town in both political and economic aspects, the main thing is that what this bill brings under the table and how it can be both beneficial and can draw criticism. Read on!
What is Trump’s “Big Beautiful Bill”?
Trump’s ambitious legislative all-in-one package, popularly called as “Big Beautiful Bill” is a sweeping tax package, which means that it will aim to revive the 2017 tax cuts while coming up with new laws which can overall affect the following sectors – healthcare, welfare and other government-controlled welfare programs.
While there are supporters chanting that this bill can make their lives easier as it will break down the taxes and will be beneficial for the middle-class American citizens; the critics say otherwise so. They argue that the Big Beautiful Bill can add another $2.4 trillion to the national deficit.
This bill is now passed in the House (with great uproar and criticism!) and further awaits review from the Senate. The heated debate is on in the Senate and the path for approval for this bill looks not smooth though.
Breakdown of the Trump’s Big Beautiful Bill
Let’s see some details on the breakdown of the Big Beautiful Bill:
- Tax Cuts: It permanently extends the 2017 tax cuts, where one won’t have to pay taxes from tips and overtime pay till 2028. It will also remove taxes on gun’s silencer, which is $200. The corporate tax will remain at 21% but it will take 3.5% of tax from those families who send money overseas. Also, there will be no tax credits on renewable energy and electric vehicles.
- Economic Benefits: You can take a deduction from car loan upto $10,000 if it’s assembled in the U.S. to encourage local manufacturing. Families will also benefit as child tax credit will increase from $500 to $2500 per child.
- Medical Changes: Able-bodied and childless adults should be working 80 hours/month work by 2026. There will be frequent eligibility check once in every six months. There will be a ban on Medicaid covering gender transition changes.
- Welfare Changes: Stricter eligibility criteria and work requirements for SNAP/food stamps and other grant cuts to federal agencies and states to save money.
- Defence: Increases the overall defence budget to $1 trillion by increasing Pentagon’s budget to $150 million, getting $5 billion for shipbuilding with submarines, destroyers etc.
- Border Security: Expansion of the physical barriers on the U.S. – Mexico border and more hiring for Customs and Border Protection (CBP) agents, Immigration and Customs Enforcement (ICE) agents, and Border Patrol officers. There will be investment in drones and surveillances and acceleration for deporting illegal and undocumented immigrants.
What are Other Important Provisions ?
There will be impact on other areas such as:
- Married couples earning upto $500,000 can deduct upto $40,000 on state and local taxes (SALT), up from $10,000 from their taxable income.
- Federal government backed $1,000 starting saving accounts for newborns, where parents will be allowed to contribute $5,000 per annum.
- Proposes a 10-year ban on state and local government creating own rules for Artificial Intelligence (AI) regulations.
- Encourage more domestic extraction and production of oil, gas and coal to become energy independent and ease from government rules.
- Change student loan programs, which could include changes to monthly repayment plans, changes in interest rates, eased or stricter criteria for loan forgiveness.
- Taxing the financial reserves (endowments) for wealthy universities, meant for research, scholarship and student aid programs as lawmakers feel that certain universities are getting biased on certain political views and not using it for their communities.
What’s next you Can Expect?
The Big Beautiful Bill has been passed in the House, and awaits passing as well in Senate. The lawmakers in the Senate will have a debate (might get heated!), review and then may make changes before passing the Bill. It would a simple majority (51 votes) under budget reconciliation rules. The deadline to pass the bill is on 4th July 2025 but negotiations might delay it.
If the Senate passes the bill without any changes, then it will go directly to the President for the final signature before it becomes a law. If the Senate provide modifications, then the bill will have another round at the House for votes before it gets the final approval.
The Support and Criticism So Far
There is a point that tax cuts will encourage more spending and economic growth and the bill focus on boosting internal job creation through domestic manufacturing and further strengthen American industries. The bill also focuses on national security and for the future, i.e. expanding child tax credit and federal-backed savings account for newborns.
Critics (now Elon Musk) have a concern that it will lead to more national debt, estimated at $2.5 trillion. Some Republicans have raised concerns on some areas like, fund cuts in Medicaid and SNAP. The immigrant communities are criticizing the 3.5% tax leverage on sending money overseas to family members. Removing tax credits on renewable energy and electric vehicles has also invited another criticism. The Big Beautiful Bill will go on more heated debates in the Senate with getting on providing more suggestions on the same.
