Updated July 1, 2025 at 11:28 AM CDT
Senate Republicans have passed President Trump's signature domestic policy bill, setting the stage for a final vote in the House on legislation that would cut trillions of dollars in taxes while scaling back spending on Medicaid, food assistance and clean energy programs.
The final vote was 51-50 with Vice President JD Vance breaking a tie. Three Republicans broke ranks and voted against the bill: Susan Collins of Maine, Thom Tillis of North Carolina and Kentucky's Rand Paul. The bill now heads to the House, where some GOP lawmakers are already signaling major objections.
Tuesday's vote capped weeks of contentious negotiations between fiscal hawks who wanted deeper spending cuts, and a handful of other Republicans who expressed concerns that cuts in the bill could have deep impacts across the country.
The bill would extend the tax cuts that were passed by Republicans in 2017, preventing a potential hike in rates at the end of this year when the current provisions are set to expire. Republicans are offsetting some of those costs with cuts to the Supplemental Nutrition Assistance Program, or SNAP, along with major changes to Medicaid, the joint federal and state program that provides health care for roughly 70 million low-income, elderly and disabled Americans. Early estimates suggest around 11 million people could lose coverage under the GOP bill.
Facing growing pressure from the White House, Republicans were able to strike a delicate balance and pass the bill with just days to go before a self-imposed July 4 deadline. The vote once again highlighted President Trump's ability to unify fractious wings inside the GOP.
"With this legislation, we're fulfilling the mandate we were entrusted with last November and setting our country and the American people up to be safer, stronger and more prosperous," said Senate Majority Leader John Thune, R-S.D., after the vote.
Even as Republicans celebrated the vote, the GOP megabill still faces a steep climb before reaching the president's desk.
To get the bill through, Republicans turned to a special budget tool known as reconciliation. By doing so, the party was able to sidestep a Democratic filibuster and pass the bill with a simple majority. But the legislation also needed to fit strict Senate rules that require all of the elements to be primarily related to the budget and spending. That meant many GOP priorities were stripped from the legislation before the final vote.
Republicans in the House and Senate must agree on identical versions of the plan before sending the legislation to Trump for his signature. The Senate version may not satisfy the many divided factions of the narrow GOP majority in the House.
Getting the Senate bill through the House without further changes will be a crucial test for House Speaker Mike Johnson, R-La.. For weeks, Johnson has pleaded with the Senate to keep any changes to a minimum. He was able to squeak the bill through by a single vote the first time — relying heavily on President Trump to win over last-minute holdouts. With Republicans clinging to a razor-thin majority in the House, their margin for error will be small.
Following the Senate vote, Johnson said in a statement that the House would work quickly to pass the bill by the Fourth of July.
"The American people gave us a clear mandate, and after four years of Democrat failure, we intend to deliver without delay," Johnson said.
Tax cuts paired with cuts to the social safety net
The broad outlines of the Senate measure largely mirror the version of the bill that House Republicans passed in May. Both would spend trillions to extend the 2017 tax cuts while steering more money to the military and immigration enforcement. Both would also make good on several of Trump's campaign pledges, including no taxes on overtime or tips, albeit on a temporary basis.
But the two chambers are split over how to pay for that spending, with some House Republicans flatly calling changes made by the Senate a non-starter for them.
One of the biggest areas targeted for savings is Medicaid. House Republicans sought to trim the bill's price tag, in part, through new work requirements for childless adults without disabilities. Seeking additional savings, the Senate plan expands those requirements to the parents of older children.
The Senate also moved to rein in what are known as provider taxes — a tax states have used to secure more federal matching dollars for Medicaid. To alleviate lawmakers who said the change risked the collapse of many rural hospitals, the Senate ultimately included a new $50 billion fund to support rural hospitals. That program would begin in 2026 and funds would be spread out over five years.
The sweeping bill — clocking in at nearly 1,000 pages — would also bring changes across a wide array of policy areas. Those include spending cuts to SNAP, which benefits more than 40 million low-income Americans. The bill commits billions to border security, overhauls the federal student loan program, and ends the $7,500 credit for buying an electric car passed as part of former President Joe Biden's Inflation Reduction Act.
Deficit tensions
Another tension point is how much to lift the debt ceiling. The House approved a $4 trillion hike — a figure that in itself was a tough sell for fiscal hawks concerned about government spending. The Senate opted for $5 trillion. Lifting the debt limit doesn't authorize new spending. Rather, it allows the government to pay for programs Congress has already authorized. Treasury Secretary Scott Bessent has told Congress that without action, the U.S. will be at risk of a potentially catastrophic default on its debt as early as August.
The nonpartisan Congressional Budget Office found that the Senate bill would add more than $3 trillion to the deficit over the next 10 years. Extending the 2017 tax cuts made up the bulk of the cost but other changes have added to the bottom line.
The Senate changed how the bill handles a deduction for state and local taxes that was pivotal to securing the votes of GOP lawmakers in the House from blue states with high taxes. The SALT cap, as the deduction is known, went from $10,000 to $40,000 in the House for married couples with incomes up to $500,000. The Senate plan keeps that new threshold in place, but the provision would expire after 2028.
The bill also targets other clean energy credits passed as part of the IRA. To win over fiscal hawks from the ultra-conservative House Freedom Caucus, the House bill set an aggressive timetable to roll back these credits. That plan would halt roughly $522 billion in investments — many of which are based in red states. The Senate sought to add additional taxes for new wind and solar projects if their supply chains are tied to China.
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