On July 1, 2025, the U.S. Senate narrowly approved President Donald Trump’s expansive tax and spending legislation, known as the “One Big Beautiful Bill Act,” with a 51-50 vote, Vice President JD Vance casting the tie-breaking vote. The bill now advances to the House of Representatives for final approval ahead of the July 4 deadline.
The legislation proposes $4.5 trillion in tax cuts, including permanent extensions to the 2017 tax rates and new exemptions for tips and overtime pay. It also introduces $1.2 trillion in spending cuts, primarily targeting Medicaid and food assistance programs through stricter eligibility criteria. Analysts project the bill could add approximately $3.3 trillion to the national debt over the next decade.
Market reactions have been cautious. U.S. stock futures showed modest gains ahead of the Federal Reserve’s policy announcement and key employment data releases. Investors are closely monitoring the potential impacts of the bill on inflation and interest rates.
