House Republicans Pass Sweeping Tax and Spending Bill After All-Night Showdown

Washington, D.C. — In a dramatic overnight session, House Republicans narrowly passed a sweeping multitrillion-dollar tax and spending bill, delivering a major legislative victory for President Donald Trump and setting the stage for a contentious Senate battle. The legislation, dubbed the “One Big Beautiful Bill Act,” represents a cornerstone of Trump’s economic agenda and includes wide-ranging tax cuts, new federal program requirements, and deep spending reductions.

Key Provisions of the Bill

• Extension of Trump-Era Tax Cuts: The bill extends the 2017 tax cuts, preserving reduced rates and higher standard deductions for individuals and businesses. These provisions, set to expire at the end of this year, will now remain in effect, with the greatest benefits projected for higher-income earners.
• No Federal Tax on Tips and Overtime: Fulfilling a Trump campaign promise, the bill eliminates federal income taxes on tips and overtime pay, a move expected to cost around $40 billion. However, experts note many tipped workers may already earn too little to owe federal income tax.
• Increased SALT Deduction Cap: Responding to pressure from Republicans in high-tax states, the bill raises the state and local tax (SALT) deduction cap from $10,000 to $40,000 for married couples earning up to $500,000. The deduction phases out for higher earners.
• Stricter Medicaid and SNAP Requirements: The legislation imposes new work requirements for able-bodied adults without dependents receiving Medicaid and SNAP benefits, and increases state contributions to SNAP. Medicaid recipients will need to verify eligibility more frequently.
• Child Tax Credit Expansion: The child tax credit rises from $2,000 to $2,500 through 2028 and will be indexed for inflation, but only for filers with Social Security numbers.
• Student Loan and Auto Loan Deductions: Borrowers can deduct up to $10,000 in interest on loans for vehicles assembled in the U.S. for tax years 2025-2028.
• Debt Ceiling Increase: The bill raises the federal debt ceiling by $4 trillion, enabling continued government borrowing to fund authorized programs.
• Cuts to Clean Energy Incentives: It rolls back clean energy tax credits enacted by Democrats in 2022.

Political Fallout and Internal GOP Divisions

The bill passed by a razor-thin margin of 215-214, with all Democrats and two Republicans voting against it, and a third Republican voting “present”. The victory followed intense negotiations and last-minute concessions, including the higher SALT cap to win over blue-state Republicans. Speaker Mike Johnson described the package as “generational, truly nation-shaping legislation”.

Despite the House win, the bill exposed deep rifts within the Republican Party. Some Senate Republicans have voiced strong opposition, citing concerns over the bill’s impact on the national debt and the economy. The Congressional Budget Office estimates the tax measures could add $3.8 trillion to the federal deficit over the next decade, on top of the existing $36 trillion national debt.

Next Steps: Senate Uncertainty

The legislation now moves to the Senate, where Republicans hold a slim majority but have already signaled plans to make significant changes. The fate of the bill remains uncertain, with ongoing GOP discord and widespread criticism from Democrats, who argue the plan favors the wealthy and undermines social safety nets.

Protests erupted outside the Capitol as the House voted, underscoring the high stakes and deep divisions over the future direction of U.S. tax and spending policy.

“The House has enacted generational, truly nation-shaping legislation,” said Speaker Johnson after the vote.

The coming weeks are expected to bring further negotiations and potential revisions as the Senate takes up the controversial package.