The U.S. Senate kicked off voting on Monday, June 30, 2025, on a sweeping Republican-backed budget package, nicknamed the “big beautiful bill” by President Donald Trump. This ambitious legislation, which cleared the House in May, aims to overhaul taxes, immigration policies, and federal spending. A revised Senate version, debated since Saturday, has sparked some pushback from House Republicans due to significant changes. Leveraging the budget reconciliation process, the GOP can bypass Democratic support to pass the bill in the Senate.Here’s a breakdown of the Senate’s version of the bill.
Extended and Expanded Tax Relief
The legislation locks in the individual tax cuts from Trump’s 2017 Tax Cuts and Jobs Act, originally set to expire in 2025. It boosts the standard deduction to $32,000 for married couples and $16,000 for individuals. The child tax credit rises to $2,200 per child, adjusted for inflation, but eligibility is limited to parents with valid Social Security numbers, excluding many non-citizens.
New Tax Breaks for Workers and Seniors
The bill introduces several deductions:
- No taxes on tips for workers in industries like food service and beauty care.
- No taxes on overtime pay, with certain restrictions.
- A deduction of up to $10,000 on car loan interest for buyers of U.S.-made vehicles.
- An additional $6,000 deduction for seniors over 65.
Major Reductions to Social Programs
The plan scales back Medicaid funding and imposes work requirements, while curbing states’ ability to tap extra federal funds through provider taxes. A $25 billion rural hospital bailout fund, starting in 2028, aims to offset these cuts. For SNAP (food stamps), the bill restricts future growth and shifts more costs to states, reducing federal coverage of administrative expenses from 50% to 25% starting in 2027.
$170 Billion for Border Security
The Congressional Budget Office reports that the bill allocates $170 billion for immigration enforcement, including:
- $46 billion to complete Trump’s border wall and maritime barriers.
- $70 billion for new detention centers and deportation logistics.
- Additional funding to expand immigration courts and hire more border agents.
Scrapping Student Loan Forgiveness and Climate Initiatives
The bill eliminates President Biden’s student loan relief program, saving an estimated $320 billion over a decade. It also rolls back key elements of Biden’s climate law by:
- Ending the $7,500 electric vehicle tax credit.
- Phasing out clean energy incentives.
- Promoting fossil fuel production through new drilling leases and relaxed coal regulations.
Boost for Defense, Cuts to Education
The legislation provides $158 billion for defense, including:
- $25 billion for defense supply chains.
- $34 billion for Trump’s “Golden Dome” missile defense system.
- $329 billion for shipbuilding and space technology.
Universities with endowments exceeding $2 million per student face a new tiered endowment tax of up to 8%.
Newborn Savings and Education Credits
The bill establishes a $1,000 “Trump Account” for every newborn, with families able to contribute up to $5,000 annually until the child turns 31. It also allocates $4 billion annually in tax credits for donations to organizations funding private school and homeschooling scholarships.
Additional Provisions
- Increases the debt ceiling by $5 trillion to avoid a default later in 2025.
- Authorizes the sale of select federal lands (excluding national parks) for housing development.
- Renews the FCC’s authority to auction wireless spectrum, potentially generating $85 billion.
This massive legislative package, if passed, could reshape the nation’s fiscal and social landscape, with far-reaching implications for taxpayers, immigrants, and federal priorities.
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