The U.S. House of Representatives, they did it! Just now, they passed the most serious tax reform bill in generations. Informally dubbed Trump’s “big, beautiful bill,” it squeaked through with a razor thin 215 to 214 margin. This legislation goes directly after a number of former President Donald Trump’s campaign promises. It would raise SALT deduction limit and make tips and overtime pay tax-free. The bill now goes to the Senate, where it will be considered or amended before going to the former president’s desk.
The draft legislation goes on to outline many significant provisions which mirror many of Trump’s policy priorities. Most infamous is its increase of the SALT deduction limit. This alteration has prompted months of angry contention between states with big local taxes, such as New Jersey and New York. Of interest, the bill would fulfill Trump’s promise to get rid of tip as well as overtime pay taxation. To be eligible for this exemption, people need to work a minimum of 80 hours per month beginning in December 2026.
One additional, but hugely important feature of the bill is raising the national debt ceiling to $4 trillion. This provision is an opening bluster to generate additional fiscal space for easing government expenditures. It has fueled alarm among fiscal conservatives about its long-term economic impact. The legislation’s longer-term extensions tax cuts included would go even further, benefiting wealthy individuals and corporations the most.
The bill had been expected to die under strong opposition from Democrats. They have repeatedly condemned its proposals to cut and block grant Medicaid and its changes to the Supplemental Nutrition Assistance Program (SNAP). House Minority Leader Hakeem Jeffries has decried the legislation as a “reckless, regressive and reprehensible GOP tax scam.” He noted the historic partisan divide on the floor that the bill represents.
The child tax credit would go up to $2,000 to $2,500 for a majority of Americans. This amendment will remain in effect until 2028 and only applies to individuals with social security numbers. Phase-out ranges for several popular deductions start at $150,000 for married taxpayers filing jointly. For single filers, the threshold will increase to $75,000.
Additionally, the bill lets Americans deduct interest on auto loans for vehicles built in the U.S. from 2025 through 2028. That’s exactly what’s in this legislation — new, punitive work requirements for childless adults without disabilities. This dramatic shift has been cited as a reason for limiting access to federal assistance programs.
Trump is said to be pushing for the Senate to pass the bill even faster. He asks that lawmakers send it to his desk without further delay.
“It’s time for our friends in the United States Senate to get to work, and send this Bill to my desk AS SOON AS POSSIBLE!” – Trump
These far-reaching provisions add up to produce an unprecedented bill exceeding 1,000 pages. This has the potential to be the most far-reaching legislative effort in the country so far. Once again, as this bill moves to the Senate, we’ll be watching intently. Will lawmakers be able to reconcile their differences, or will a series of amendments fundamentally reshape it before it gets approved?