US House passes Trump’s big tax bill headed next for the Senate
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WASHINGTON: House Republicans stayed up all night into Thursday (May 22) to pass a multitrillion-dollar spending package, with Speaker Mike Johnson unifying the Republican ranks to get President Donald Trump's package through.
With last-minute concessions Republican holdouts mainly dropped their opposition to get what the President has called the 'One Big Beautiful Bill' passed, and onto the Senate for consideration.
The 1,100-page bill would extend corporate and individual tax cuts passed in 2017 during Trump's first term in office, cancel many green-energy incentives passed by Democratic former President Joe Biden and tighten eligibility for health and food programs for the poor.
It also would fund Trump's crackdown on immigration, adding tens of thousands of border guards and creating the capacity to deport up to 1 million people each year. Regulations on firearm silencers would be loosened.
Democrats blasted the bill as disproportionately benefiting the wealthy while cutting benefits for working Americans. The Congressional Budget Office found it would reduce income for the poorest 10% of US households and boost income for the top 10%.
"This bill is a scam, a tax scam designed to steal from you, the American people, and give to Trump's millionaire and billionaire friends," Democratic Representative Jim McGovern said.
BILL ADDS TO GOVERNMENT DEBT
The House launched debate before midnight, and by dawn, the vote was called, 215-214, with Democrats staunchly opposed.
The outcome caps an intense time on Capitol Hill, with days of private negotiations and public committee hearings, many happening back-to-back, around-the-clock. Republicans insisted their sprawling 1,000-page-plus package was what voters sent them to Congress — and Trump to the White House — to accomplish.
However, it will add about $3.8 trillion to the federal government's $36.2 trillion in debt over the next decade, according to the nonpartisan Congressional Budget Office.
All of the chamber's Democrats and two Republicans voted against it, while a third Republican voted "present", neither for nor against the bill. Another Republican missed the vote because he had fallen asleep.
US GOVERNMENT DEBT HAS REACHED 124% OF GDP
The bill passed despite growing concerns over US debt, which has reached 124% of GDP, prompting a downgrade of the United States' top-notch credit rating by Moody's last week.
The US government has recorded budget deficits every year of this century, as Republican and Democratic administrations alike have failed to bring spending into alignment with revenue.
Interest payments accounted for 1 out of every 8 dollars spent by the US government last year, more than the amount spent on the military, according to the CBO. That share is due to grow to 1 out of every 6 dollars over the next 10 years as an ageing population pushes up the government's health and pension costs, even if Trump's budget bill is not taken into account.
Investors unnerved by the US's worsening fiscal position and Trump's erratic tariff moves have been selling off US 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 US government borrowing costs, have reached their highest level since October 2023.
The growing debt has paradoxically given urgency for Republicans to pass the bill, as it would raise the federal government's debt ceiling by $4 trillion. That would avert the prospect of a default, which officials have warned could otherwise come sometime this summer.
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