Trump’s ‘big, beautiful’ tax bill passes US House
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The news: US President Donald Trump’s signature tax bill passed the US House of Representatives by a narrow margin, pushing the far-reaching package through to the Senate.
The numbers: The vote came in at 215 to 214, with one abstention.
The bill includes a USD4 trillion ($6.23 trillion) increase in the US debt ceiling, which the Treasury Department forecasts could otherwise force a default as soon as August or September.
The context: The bill will extend Trump’s first-term cuts that are due to expire on 31 December this year, as well as adding new tax relief that would raise the limit on the deduction for state and local taxes to USD40,000 and would temporarily exempt tips and overtime pay from tax.
The bill would also see cuts to food stamps and Medicaid health coverage for the poor and disabled, with minority leader of the House Hakeem Jeffries stating that the bill would deprive at least 13.7 million people of their healthcare insurance: “It’s one, big ugly bill…It’s an assault on the economy…to enact the largest tax breaks for billionaires in American history.”
Speaker Mike Johnson called Trump’s “big beautiful bill” the most “consequential legislation that any party has ever passed,” and that it is a “turning point in American history.”
The non-partisan Committee for a Responsible Federal Budget estimates that the legislation will increase US national debt by more than USD3.3 trillion over the next ten years and see federal government debt held by the public increase from about 98% of GDP to a record 125%.
Representatives Warren Davidson of Ohio and Thomas Massie of Kentucky were the only two Republicans who voted against the measure as they argue it does not do enough to tackle deficit spending. All Democrats opposed the bill.
The bill is expected to face another significant hurdle in the Senate.
