The United States Senate is debating President Donald Trump’s “One Big Beautiful Bill“, which promises sweeping tax breaks, as Republicans hope to pass it before Friday’s Independence Day holiday.
On Saturday, the Senate voted 51-49 to open debate on the latest 940-page version of the bill, despite two Republican senators joining the Democrats to oppose the motion. Trump’s Republicans hold 53 seats in the Senate, and Democrats hold 47.
What’s next if the Senate passes the bill?
On May 22, the Republican-controlled House of Representatives passed an earlier version of the bill in a 215-214 vote.
That bill has been revised by the Senate, and both chambers of Congress must pass the same legislation for it to become law. If the Senate passes its version, then members from both chambers would work to draft compromise legislation that the House and Senate would have to vote on again. Republicans hold 220 seats and Democrats hold 212 in the House.
If the compromise bill is passed, it would advance to Trump, who is expected to sign it into law.
So, who would be some of the winners and losers if the bill – opposed by Democrats and some conservatives – becomes law?
Who would benefit from the bill?
The groups who would benefit include:
High-income households
The bill would extend tax cuts that Trump introduced during his first term. While Trump has pitched this as a gain for the American people, some will benefit more than others.
More than a third of the total cuts would go to households with an annual income of $460,000 or more. About 57 percent of the tax cuts would go to households with a yearly income of $217,000 or more.
According to an analysis by the nonpartisan Tax Policy Center, the Senate bill would slash taxes on average by about $2,600 per household in 2026. “High-income households would receive much more generous tax benefits”, its analysis said.
Families with children
If the bill does not pass, the child tax credit, currently at $2,000 per child per year, would drop to $1,000 in 2026.
However, if the current version of the Senate bill passes, the child tax credit will permanently increase to $2,200. This is a smaller increase than the $2,500 in the version of the bill that the House approved.
Traditional car manufacturers
Makers of traditional petrol-driven cars could benefit from the bill because the Senate version seeks to end the tax credit for purchases of electric vehicles (EVs), worth up to $7,500, starting on September 30.
This could decrease consumer demand for EVs, levelling the playing field for cars that run on petrol or diesel.
Workers who receive tips
Tips will not be taxed if the bill passes.
Currently, workers – whether waiters or other service providers – are required to report all tips in excess of $20 a month to their employers, and those additional earnings are taxed.
This bill would end that.
Who would lose out because of the bill?
Some of the groups that would not benefit include:
Food stamp recipients
The Senate version of the bill proposes slashing the food stamps programme, called the Supplemental Nutrition Assistance Program (SNAP), by $68.6bn over a decade, according to an analysis by the nonpartisan Congressional Budget Office (CBO).
Food stamps help low-income families buy food. In the 2023 fiscal year, 42.1 million people per month benefited from the programme, according to the US Department of Agriculture.
Medicaid beneficiaries
The Senate version of the bill proposes federal funding cuts by $930bn to Medicaid, the largest US programme providing healthcare to low-income people. These are cuts to budget outlays by 2034.
The bill says that starting in 2026, able-bodied adults under the age of 65 will be required to work 80 hours a month to continue to receive Medicaid, with the exception of those who have dependent children.
More than 71 million low-income Americans were enrolled in Medicaid for health insurance as of March.
EV manufacturers
The EV tax credit would end on September 30 if the Senate version of the bill passes. The House version aims to phase out the tax credit by the end of 2025.
Billionaire Elon Musk, who owns the EV manufacturer Tesla, has voiced his opposition to the bill online. “I’m sorry, but I just can’t stand it anymore. This massive, outrageous, pork-filled Congressional spending bill is a disgusting abomination,” Musk wrote on X on June 3.
He doubled down on his criticism before the Senate deliberations on the bill on Saturday.
“The latest Senate draft bill will destroy millions of jobs in America and cause immense strategic harm to our country,” Musk wrote on X, a platform he owns.
Fiscal conservatives
Some conservatives have criticised the bill, saying it would inflate the country’s enormous debt.
The CBO estimated that the Senate version would raise the national debt by $3.3 trillion from 2025 to 2034. Under the House version, the CBO estimated a $2.4 trillion increase in the debt over a decade.
