Republicans’ reconciliation tax bill: the one big beautiful bill act

You can make a difference

House Republicans just voted for a tax bill that does real harm to working Americans—slashing Medicaid, food assistance, and threatening Medicare to pay for massive tax breaks for billionaires. It’s a cruel, upside-down set of priorities that puts the ultra-wealthy first and working families last.

But this fight isn’t over yet. The Senate is up next and we have a plan to block this bill. Click here to join Indivisible’s Wednesday and Thursday phone banks-Every Wednesday and Thursday in June, join Indivisible for a phonebank where we’ll be calling voters and connecting them directly to their Senator. Together, we’ll urge Republicans to oppose the Trump Tax Scam—a reckless GOP tax plan that prioritizes billionaires like Elon Musk while selling out working families.

The bill is both a policy disaster and a moral monstrosity. It adds trillions to the deficit, defunds Planned Parenthood, guts Medicaid, slashes food stamps, raises costs on millions of families, and gives the richest Americans a massive tax cut. ((Message Box)

Hoosiers will pay a terrible price if this budget passes as written: in total, 232,000 Hoosiers will lose their health insurance. 151,000 Hoosiers will lose food stamps. 24,958 clean energy jobs will be eliminated. (MadVoters)
In Indiana District 1 alone, 27,000 would lose their health insurance; 26,000 could lose SNAP benefits and nearly 500 clean energy jobs could be lost. See the breakdown for other districts in Indiana and across the country at Center for American Progress.

From MadVoters, Take Action Tip of the Week: Gather your friends or members of your organization to make two phone calls.
One to Senator Todd Young, 202-224-5623
Local office numbers:

812-542-4820 – New Albany, IN
317-226-6700 – Indianapolis, IN
219-747-7780 – Valparaiso, IN

And one to Senator Jim Banks, 202-224-4814
Local office numbers:

260-321-7130 – Fort Wayne, IN

in regards to the US budget. Unlike Congresspeople, who represent different districts in the state, our US Senators represent the entire state and every single Hoosier. Phone calls are most effective, especially when done en masse. You can reference the information above when you call. Here’s a sample script:

“Hello, this message is for Sen. {name]. I’m a constituent living at [address]. You can reach me at [phone number]. I’m urging the Senator to oppose the House-passed budget, which threatens healthcare for {number] Hoosiers in my area, as well as SNAP eligibility for [number]. We won’t make America great by taking away affordable food and healthcare from vulnerable Hoosiers. Thank you for your consideration.”

It’s important that you leave your address when you call so that staff can verify your constituency. Keep your message brief and polite, as you will be talking to a staff member, not the Senators themselves.

You can also call using 5calls.org. They give you scripts and phone numbers.

Congress

Passed the House, Senate next

H.R. 1: One Big Beautiful Bill Act

Last Action: On passage Passed by the Yeas and Nays: 215 – 214, 1 Present with no Democratic support. View the vote.

The bill—the basics:

A $3.8 trillion extension of the 2017 Trump tax cuts, which overwhelmingly benefit the wealthy.
Nearly $700 billion in Medicaid cuts, which could cause 8.6 million people to lose coverage.
$267 billion in cuts to SNAP (food stamps)—kicking 3 million families off assistance and jeopardizing school meals for 18 million children.
A massive increase in defense spending, plus over $100 billion for Trump’s mass deportation efforts.
Defunding of Planned Parenthood, via a ten-year block on Medicaid reimbursements.
Elimination of several clean energy tax credits created by the Inflation Reduction Act.
Over $300 billion in cuts to student loan programs, including repeals of Biden-era income-driven repayment and forgiveness efforts.
An extension of the debt ceiling, likely into 2027.

The richest Americans—those making $1 million or more—would get nearly $90,000 in tax breaks each year while low income Americans will actually lose money because of cuts to essential services and a very small tax break, just over $350 per year.

According to the Congressional Budget Office, by 2027 the bill would increase household resources for the top 10% by 4% while reducing them by 4% for the bottom 10% by 2033.
The biggest losers are Americans making about $17,000 to $51,000 who would lose about $700. Those with an income of less than $17,000 would lose more than $1,000 on average. The losses are mainly a result of cuts in assistance programs including Medicaid, health insurance marketplaces, the Supplemental Nutritional Assistance Program and student loans.
The CBO (the nonpartisan Congressional Budget Office) found it would reduce income for the poorest 10% of U.S. households and boost income for the top 10%.
It could trigger up to $500 billion in automatic Medicare cuts under budget enforcement rules.
Congressional Budget Office report on the bill said there would, on net, be “an increase in the federal deficit of trillions, attributable to tax changes, including extending provisions of the 2017 tax act.”
Medicaid is very popular, even among Republicans (75% overall, 62% of Republicans). But few people know about the Medicaid cuts in this bill. It’s up to us to let them know what is in this bill.

Donald Trump and the Republican Party just voted to give a massive tax cut to the rich and pay for it by raising costs on working-class Americans. That’s not just bad policy. It’s a political opportunity. If we do the work, voters will hold them accountable. (Message Box)

In Indiana District 1, 27,000 would lose their health insurance; 26,000 could lose SNAP benefits and nearly 500 clean energy jobs could be lost. See the breakdown for other districts in Indiana and across the country at Center for American Progress.

A breakdown of this reconciliation budget bill:

Artificial Intelligence

Prohibits any state or subdivision from passing “any law or regulation regulating artificial intelligence models, artificial intelligence systems, or automated decision systems during the 10-year period beginning on the date of the enactment of this Act.” It requires the repeal of any such laws already on the books

Clean energy

The bill would roll back some of the clean energy tax credits under the Biden-era climate and health care law, like an earlier phasing out of a tax break for clean energy vehicles.
Moves up the timeline to end tax credits for new renewable energy power plants as well, requiring them to begin construction within 60 days of the enactment of the legislation and be in service by the end of 2028. The measure makes an exception for nuclear plants, which must be under construction by the end of 2028.
Eliminating the Inflation Reduction Act’s clean energy tax credits could put as many as 686,000 jobs (both operational and construction) at risk. Since the passage of the clean energy tax credits in August 2022, companies have invested $321 billion in the manufacturing and deployment of clean energy, clean vehicles, electrification of homes and businesses, and carbon management, leading to the creation of more than 2,300 new facilities that created over 300,000 jobs across the country.
Another $522 billion and 686,000 jobs (both operational and construction) have been announced but are still outstanding and are likely to be cancelled if Congress repeals some clean energy tax credits and makes others unusable due to unworkable red tape, as proposed in the House bill.
The legislation also adds annual federal registration fees for EV and hybrid car owners: $250 for electric vehicles and $100 for hybrids.

Courts

Prohibits any funds from being used to carry out court orders holding executive branch officials in contempt. This is designed to enable Trump and his officials to continue defying court orders. It is almost certainly unconstitutional—if courts have the nerve to say so.

Deficit

Raises the debt ceiling by trillions, adding the $36 trillion federal debt.

Immigration and Border security funding

$46.5 billion for the border wall,
$4.1 billion to hire Border Patrol agents and other personnel and
more than $2 billion for signing and retention bonuses for Border Patrol agents. It
also includes an additional $1,000 fee for people who are filing for asylum in the U.S.
an additional $12 billion for expenses related to border security.
The bill adds $45 billion to build immigration jails—more than 13 times ICE’s current detention budget.
Allows indefinite detention of immigrant children.
Charges families $3,500 to reunite with a child who arrived alone at the border

Medicaid

Includes changes to Medicaid, a popular entitlement program that provides government-sponsored health care for low-income Americans —

Medicaid is a lifeline for more than 70 million people, including more than 15 million people with disabilities.
An estimated ten to 15 million people could lose their health insurance coverage under the bill. Medicaid pays for mental health services, treatment for opioid use disorder, and the care workers that allow our disabled and aging neighbors to live in and work in their homes.

This bill would

impose work requirements beginning no later that Dec. 31, 2026 for able-bodied adults without children, those who are able-bodied and those who do not have children under age 7.
require more frequent eligibility checks.
cut federal funds to states that use Medicaid infrastructure to provide health care coverage to undocumented immigrants.
ban Medicaid from covering gender transition services for children and adults.
block Medicaid patients from seeking care at Planned Parenthood health.
eliminate provider taxes, which states use to fund Medicaid. This could reduce payments to hospitals and doctors, leading to staff layoffs and longer wait times for care.
cause health care providers could lose close to $800 billion in revenue over the next decade if the House-passed GOP megabill becomes law, according to a new analysis from the Urban Institute backed by the Robert Wood Johnson Foundation.
cause hospitals to take catastrophic losses, with $306 billion in lost revenue, per the analysis from the think tank and philanthropy headed by former CDC acting director Rich Besser. Prescription drug revenue would also fall by $184 billion, and physicians’ revenue would fall by $79 billion. Uncompensated care would rise $198 billion over a decade.
Those findings stem from changes to both Medicaid and the Affordable Care Act under the bill, which would cumulatively lead to more than 11 million people losing health care coverage, according to the Congressional Budget Office.

SNAP (Food stamps)

Raises the upper age requirement for able-bodied adults without children to qualify for benefits under the Supplemental Nutrition Assistance Program, also known as SNAP, or food stamps. Currently, in order to qualify, able-bodied adults between 18-54 must meet work requirements. The House bill would update the age requirement to 18-64 and would also shift more of the costs to states. Reduces SNAP by $267 billion over 10 years.
States would shoulder 5% of benefit costs, beginning in fiscal 2028, and 75% of the administrative costs. Currently, states pay none of the benefit and half of the administration costs.

Student loans

Repeals student loan relief regulations enacted by President Joe Biden‘s administration
The number of repayment plans for federally held loans would shrink to just two programs.
The bill would also impose significant caps on loans for parents and undergraduate students
Eliminates a lending program for future graduate students.

Taxes

At the center of the legislation — and accounting for its biggest expense — are the provisions extending Trump’s 2017 Tax Cuts and Jobs Act..
The bill “would cut taxes on average by about $2,800 in 2026,” according to an analysis by the nonpartisan Tax Policy Center.
More than two-thirds of the total cuts would go to those with annual incomes of about $217,000 or more, the center said.
Those with incomes of $1.1 million or more would get nearly a fourth of the cuts.
Beyond the 2017 tax cuts, the legislation includes a number of tax cuts that the president touted on the campaign trail. It includes no taxes on tips for workers in the service industry, like those who work at restaurants and bars, as well as people who work in the beauty industry., but only until the end of 2028.
Also includes no taxes on overtime through 2028. Federal revenue could be reduced by $680 billion to $866 billion from 2025 to 2034 if overtime pay isn’t taxed, according to a study by the Tax Foundation and Yale’s Budget Lab in April.
Allows tax deductions on up to $10,000 in interest on auto loans for cars assembled in the U.S. This provision would be in place until 2029.
Eliminates a longstanding $200 tax on gun silencers, which has been on the books since Congress passed the National Firearms Act in 1934.
Temporary $500 increase in the child tax credit, bringing it to $2,500 through 2028. It also lowers the eligibility income threshold, making millions of children ineligible. The bill also excludes from the credit 4.5 million children who have a parent without a Social Security number but who pays taxes with a tax identification number. These children are predominantly U.S. citizens with an immigrant parent.
Imposes a tax on cash payments sent by non-U.S. citizens to family members in their home countries at a rate of 3.
Increase to the cap on the State and Local Tax Deduction from $10,000 to $40,000
Temporarily boosts the standard deduction — a $1,000 increase for individuals, bringing it to $16,000 for individual filers, and a $2,000 boost for joint filers, bringing it to $32,000.
The estate tax exemption rises to $15 million and is adjusted for inflation going forward. It is $30 million for couples in 2026. So a couple could leave $29.99 million to their heirs, tax-free.
Gives $20 billion in the form of tax credits to donors who give money to voucher schools. It also creates a tax shelter from paying capital gains taxes to donors who give appreciated stock to voucher schools. These two provisions amount to a direct federal subsidy to voucher schools using wealthy individuals as a pass-through.
Repeals the Biden administration sponsored a Direct File measure to allow taxpayers to save money by using a free IRS tool to file their tax return rather than paying commercial tax preparers.
A $4,000 increase in the standard deduction for seniors until the end of 2028
Gives the administration the power to define nonprofits as “terrorist-supporting organizations” and expedite the ending of their tax status. This is ostensibly directed against pro-Palestinian groups, but could be used to suppress the free speech and activism of climate organizations and others.

Trump accounts

The legislation also creates $1,000 savings accounts for children, which were originally titled “MAGA accounts” — Money Accounts for Growth and Advancement. The name has been updated to “Trump accounts.” Under the plan, the federal government will contribute $1,000 to the accounts of children born between 2024 and 2028. Parents can contribute up to $5,000 a year. The funds, which can begin to be distributed once the child turns 18, can be used for higher education, job training and the purchase of their first home.

This bill would also

Place a ban on coverage for abortion care in the private health insurance marketplace.
Could trigger up to $500 billion in automatic Medicare cuts under budget enforcement rules.
Impose $50 billion in cuts to the Federal Employee Retirement System, including significant reductions in take-home pay, retirement benefits, and protections against unjust treatment for federal workers.
Slash to funding for the Consumer Financial Protection Bureau (CFPB) by nearly 70% and a complete dissolution of the Public Company Accounting Oversight Board, the government’s top watchdog of public company audits.
Pull language from the REINS Act, a long-time Republican goal, that would give Congress new control over federal rule making. This would make it easier for Republicans to roll back any regulation they don’t like, including those that have already been finalized and implemented.

(USA Today) (CBS), (PBS). (American Prospect), (ACLU), (USA Today), (Center for American Progress), (FactCheck.org) (5calls.org)

And a great summary from Indivisible Central Indiana includes an outline of the most egregious non-fiscal provisions that may be lesser known:

The “guts” of the bill are the fiscal provisions. Basically, the bill is an effort to fund the extension of Trump’s tax cuts for the rich by eliminating health care for the poor and middle class.
The Congressional Budget Office (CBO) estimates that as many as 16 million people would lose health insurance under the House-passed version of the bill. The annual cuts to Medicaid would average over $70 billion a year—the same amount millionaires and billionaires would gain in tax cuts. The media has focused on those Medicaid cuts, but a number of analysts have explained that measures that have been minimized as “technical revisions” would essentially repeal Obamacare/Affordable Care Act (ACA).
Republicans who claim that they’re just adding “work requirements” to Medicaid are lying—the budget cuts $715 billion from Medicaid and $335 billion from Obamacare/ Affordable Care Act (ACA). And prior experience in the states has demonstrated that work requirements do nothing but erect paperwork barriers that throw eligible people off Medicaid; as we’ve learned from those previous efforts, Medicaid recipients who are able to work, are already working—most Medicaid recipients are disabled, elderly or children.
The consequences of these cuts would close many, if not most, rural hospitals and would have a dramatically negative impact on local economies, ironically mostly in Red states like Indiana. Economists have estimated that depressed local spending under the House bill would force the loss of 850,000 jobs. (Health care is the largest employer of any sector of the economy; it employs 18 million workers.)
The House-passed version would cut nearly $300 billion from the Supplemental Nutrition Assistance Program (SNAP), according to Congressional Budget Office (CBO) estimates. That would be by far the largest cut to SNAP in history, and it would mean that millions of low-income people would lose some or all of the food assistance they need to afford groceries and feed their children. SNAP has been the nation’s most effective anti-hunger program, and the bill cuts it by roughly 30 percent. These extreme cuts are actually deeper than the $230 billion in cuts the original budget resolution called for because the bill adds tens of billions of dollars in new spending for farm programs and pays for those dollars by taking more food assistance away from people with low incomes.
The bill blows up the budget deficit. According to the Congressional Budget Office, the bill will increase borrowing by a total of $2.4 trillion by 2034, because the $1.3 trillion in cuts to Medicaid, food stamps, and other programs don’t even come close to canceling out $3.7 trillion in tax cuts for the rich. Just the tax cuts going to the richest 5 percent outstrip the cuts to Medicaid and food stamps by 300 billion. And if you add in interest costs, the total debt the bill creates exceeds $3 trillion.
A measure to cripple the courts by prohibiting any funding from being used to carry out court orders holding executive branch officials in contempt. Passage of this measure would enable Trump and his officials to defy court orders at will.
The addition of billions to various parts of Trump’s deportation efforts, ramping up those efforts to the tune of an additional trillion dollars overall. That includes $45 billion for construction of immigration jails (more than 13 times ICE’s current detention budget.) In addition, it would allow the indefinite detention of immigrant children and would charge families $3,500 to reunite with a child who arrived alone at the border. Asylum seekers will be charged an “application fee” of at least $1,000.
The administration would be given authority to label nonprofits as “terrorist-supporting organizations,” (e.g. ACLU) and terminate their tax status- an open invitation to suppress the free speech and activism of climate and civil liberties organizations, among others of which Trump and MAGA disapprove.
The bill would eliminate the National Weather Service, making local weather reports far less accurate.
One provision would allow the administration to sell off national parks.
A particularly ugly provision repeals the $200 excise tax on the sale of gun silencers, which have no lawful purpose other than concealing shootings
The major goal of the bill is to protect the extremely wealthy against efforts to get them to pay their fair share of taxes–basically, the bill exempts rich people from paying their dues to the country that made their accumulation of wealth possible. (For example, the bill would basically eliminate an Estate Tax that is already massively favorable to the top 1%.). It would also increase taxes for low-income families.
The bill weakens the Child Tax Credit, by lowering the eligibility income threshold, so millions of children will suddenly become ineligible. It expands school vouchers–continuing the GOP effort to destroy public education and shift tax dollars to religious institutions, in violation of the First Amendment. It includes a variety of “Stealth Cuts’ to the Affordable Care Act that will increase out-of-pocket costs and make insurance more expensive for those people who are fortunate enough to retain it.

The bill passed despite growing concerns over the U.S. debt, which has reached 124% of GDP, prompting a downgrade of the United States’ top-notch credit rating by Moody’s last week.

Investors, unnerved by the country’s worsening fiscal position and Trump’s erratic tariff moves, have been selling off U.S. assets that make up the bedrock of the global financial system. The dollar has fallen more than 10% since January while yields on 30-year Treasury bonds, a proxy for long-term U.S. government borrowing costs, have reached their highest level since October 2023. (Reuters)

Some of the provisions in the bill won’t be allowed under the Senate Byrd rule that requires everything in the bill to be budget related. Read more at Politico.

A reminder: “In his first term, Trump promised that his tax cut plans would “pay for themselves.” But the national debt increased by $1.9 trillion. And that tax cut windfall for corporations was not used to create more jobs or raise pay for workers. In most cases, the money went to buy back corporate stocks and make executives and investors richer.” (The Hill)

You can make a difference

Congress

Passed the House, Senate next

A breakdown of this reconciliation budget bill:

To find and contact your Members of Congress: https://www.usa.gov/elected-officials