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House Republicans on Monday released a sweeping $4.9 trillion tax proposal, dubbed “THE ONE, BIG, BEAUTIFUL BILL,” advancing former President Donald Trump’s 2025 economic agenda and setting off a fierce political battle over tax policy, spending, and the federal deficit.
The package, unveiled by the House Ways and Means Committee, would extend and expand Trump-era tax cuts that are set to expire, while introducing a raft of new tax breaks aimed at appealing to working-class Americans — including deductions for tipped wages, Social Security benefits, auto loan interest, and overtime pay.
However, the proposal is partially offset by deep cuts to Medicaid and rollback of green energy incentives, sparking significant blowback from Democrats and concern within GOP ranks. Preliminary estimates from the Joint Committee on Taxation peg the cost of the bill at $4.9 trillion over ten years, with some Republicans warning that final costs could soar toward $20 trillion.
“We must ignore calls to cut Medicaid and start delivering on America’s promise for America’s working people,” wrote Sen. Josh Hawley (R-Mo.) in a New York Times op-ed, calling Medicaid cuts “morally wrong and politically suicidal.”
The legislation boosts the standard deduction by $2,000, bringing it to $32,000 per household, increases the child tax credit from $2,000 to $2,500 for four years, and raises the estate tax exemption from $14 million to $15 million, indexing future increases to inflation.
Also included is Trump’s campaign promise to eliminate taxes on tips. The bill instructs the Treasury to prevent businesses from exploiting the change while ensuring workers benefit. Car buyers would get a deduction of up to $10,000 on interest from U.S.-assembled vehicles, a break set to expire with Trump’s term.
For seniors, the package includes a $4,000 deduction on Social Security benefits for those with incomes below $75,000 ($150,000 for couples).
But the proposal’s Medicaid provisions have drawn the most controversy, with $880 billion in cuts proposed by the House Energy and Commerce Committee. The new requirements would force able-bodied adults without dependents to log 80 hours of work or community service per month, and verify their eligibility twice annually. The Congressional Budget Office estimated the changes could result in 8.6 million Americans losing coverage.
In addition to health care cuts, the bill targets green energy programs from President Biden’s Inflation Reduction Act, slashing subsidies for renewable projects and redirecting funds toward natural gas and oil development.
The measure also seeks to triple the SALT deduction cap from $10,000 to $30,000 for couples, but limits benefits for high earners, drawing criticism from GOP lawmakers in high-tax states.
“Still a hell no,” Rep. Nick LaLota (R-N.Y.) posted on social media in response to the SALT compromise.
Another controversial item is a provision to strip tax-exempt status from nonprofits labeled as supporters of terrorism by the State Department — a move civil society groups warn could be weaponized against organizations critical of the Trump administration.
Speaker Mike Johnson has called for a vote by Memorial Day, pushing for round-the-clock hearings this week as 11 House committees compile their portions of the bill. The last will be the Agriculture Committee, expected to propose changes to food stamp eligibility.
Trump praised the package on Truth Social, calling it “GREAT” and urging Republicans to “UNIFY” behind it.
“We have no alternative. WE MUST WIN!” he wrote before departing for a trip to the Middle East.
With Democrats unified in opposition and internal GOP divisions mounting, the road ahead for the bill remains uncertain. However, the stakes are high: not since the 2017 tax law has such a sweeping economic overhaul been seriously considered in Congress.
