House Vote on Tax Bill: Provisions, Medicaid Cuts, and Deficit Impact

The U.S. House of Representatives passed the One Big Beautiful Bill Act on July 3, 2025, by a vote of 218 to 214, sending the tax, spending, and immigration package to President Donald Trump, who signed it into law the next day as Public Law 119-21.¹ All 218 yes votes came from Republicans; every Democrat voted no, joined by two Republican defectors.² The Congressional Budget Office estimated the legislation would add $3.4 trillion to the federal deficit over the next decade.³

How the Final House Vote Unfolded

The House had actually voted on the bill twice. The first time, on May 22, 2025, the chamber passed its own version by a single vote, 215 to 214.⁴ The Senate then amended the bill and passed it 51 to 50 on July 1, with Vice President JD Vance breaking the tie.⁵ Because the Senate had deepened Medicaid cuts and removed several provisions, the bill had to return to the House.

The final House vote turned into one of the more dramatic sequences in recent memory. On the evening of July 2, the House began a procedural vote to adopt the rules for floor debate. At least five Republicans initially voted no, and leaders held the vote open for hours while flipping holdouts. The rule finally cleared at about 3:20 a.m. on July 3, by a vote of 219 to 213.⁶

Once debate opened, House Minority Leader Hakeem Jeffries used the “magic minute,” a procedural allowance that gives party leaders unlimited speaking time. He spoke for 8 hours and 44 minutes, setting a new record for the longest floor speech in House history and breaking the mark of 8 hours and 32 minutes that Kevin McCarthy had set in 2021.⁷ Jeffries called the bill “wrong, dangerous, and cruel,” read constituent letters about Medicaid and SNAP, and cited hip-hop lyrics, the Declaration of Independence, and the late John Lewis.⁸ The speech delayed the vote but did not change the outcome. The House passed the bill at 2:31 p.m.²

The Two Republicans Who Voted No

With a narrow majority, Speaker Mike Johnson could afford almost no defections. In the end, two Republicans broke ranks.

Rep. Thomas Massie of Kentucky opposed the bill on fiscal grounds, saying it “will significantly increase U.S. budget deficits in the near term, negatively impacting all Americans through sustained inflation and high interest rates.” Rep. Brian Fitzpatrick of Pennsylvania, who had voted yes on the May version, switched to no after the Senate added deeper Medicaid cuts and removed protections he considered important for his district.⁹

Other Republican holdouts got concessions before voting yes. Freedom Caucus members, including Chair Andy Harris and Rep. Scott Perry, pressed for deeper and faster spending cuts and a quicker phaseout of clean-energy tax credits. Blue-state moderates pushed the SALT deduction cap up to $40,000 after starting with an offer of $30,000 against the existing $10,000 limit. Rep. Ralph Norman voted yes after Trump promised future executive action on wind and solar credits. Rep. Andrew Clyde failed to strip the federal firearms excise tax in the Senate but voted yes anyway, citing the broader agenda.¹⁰¹¹

Tax Provisions in the Law

The bill made permanent the individual income tax framework from the 2017 Tax Cuts and Jobs Act, which had been scheduled to expire after 2025. That includes the lower individual rates, the larger standard deduction, the modified alternative minimum tax threshold, and the 20 percent pass-through deduction (which the new law raised to 23 percent).¹²¹³ The estate and gift tax exemption was permanently raised to $15 million per individual (about $30 million for married couples), indexed for inflation starting in 2026.¹⁴

Three new above-the-line deductions run from 2025 through 2028, meaning taxpayers do not have to itemize to claim them:

Tipped workers may deduct up to $25,000 in tip income per year, phasing out above $150,000 in income ($300,000 joint).¹⁵
Workers may deduct the premium portion of overtime pay (the “half” in time-and-a-half) up to $12,500 per year ($25,000 joint), with the same income phase-outs.¹⁵
Buyers of new vehicles with final assembly in the United States may deduct up to $10,000 in auto loan interest annually, subject to weight, use, and income limits.¹⁵

The White House estimated the tips exemption at about $1,300 in annual savings for eligible workers and the overtime exemption at about $1,400.¹³ All three deductions require a Social Security number and expire after 2028.

The SALT deduction cap moved from $10,000 to $40,000 for filers with modified adjusted gross income up to $500,000, then phases down by 30 cents on the dollar to a $10,000 floor at $600,000 in income. The cap and the threshold rise by 1 percent annually through 2029, after which the cap reverts permanently to $10,000.¹⁶ The child tax credit rose from $2,000 to $2,200 per child and is now indexed to inflation permanently.¹⁷ A new “Trump Accounts” pilot provides a one-time $1,000 government contribution for children born from 2025 through 2028 who have Social Security numbers, with family and employer contributions permitted.

On the business side, the law restored 100 percent first-year expensing for machinery and equipment and made domestic research and development costs immediately deductible again (foreign R&D still amortizes over 15 years).¹⁶¹⁸¹⁴

Medicaid and Health Care Cuts

The bill’s health care provisions drew the fiercest opposition. The CBO estimated federal Medicaid and CHIP spending would drop by about $1.02 trillion over ten years.¹⁹ The reductions come from several mechanisms:

Starting in January 2027 (with state waiver flexibility through January 2029), Medicaid beneficiaries must work, volunteer, or engage in work-related activities at least 80 hours a month, or attend school at least half-time. Exemptions cover pregnancy, medical frailty, caregiving for a disabled family member, and parenting a child under 14.¹⁹
States must redetermine eligibility for the expansion population every six months instead of every twelve, also beginning January 2027.²⁰
Beginning in fiscal year 2029, expansion enrollees with incomes above the federal poverty level face new cost-sharing requirements.¹⁹
Beginning in fiscal year 2027, states cannot raise provider taxes to generate federal matching funds.¹⁹

The American Medical Association projected roughly 11.8 million people would lose health coverage.²⁰ To soften the rural impact, the Senate added $50 billion in rural hospital relief over five years.²¹ The law also lets the enhanced Affordable Care Act marketplace premium tax credits expire at the end of 2025 and requires pre-enrollment income verification, ending automatic re-enrollment.

SNAP and Nutrition Assistance

The law cut roughly $187 billion from the Supplemental Nutrition Assistance Program over ten years, according to the CBO.²² Work requirements, previously limited to certain adults aged 18 to 50, now cover adults 55 through 64 and parents of children over 14. Participants must work at least 20 hours a week or face a three-month benefit limit over a three-year period. The state share of administrative costs rises from 50 to 75 percent starting in fiscal year 2027, and states with high payment error rates must cover a portion of benefit costs starting in fiscal year 2028.²³

By early 2026, more than 3.5 million SNAP beneficiaries — about 9 percent of participants — had lost access to the program, according to CNBC.²²

Immigration and Border Enforcement

The law allocated approximately $170.7 billion in additional immigration and border enforcement funding through September 30, 2029.²⁴ The largest categories are:

$51.6 billion for border wall construction, maintenance, checkpoints, and related infrastructure.
$45 billion to expand detention capacity, including family facilities. The law explicitly permits indefinite family detention and overrides certain protections from the Flores Settlement Agreement.
$29.9 billion for ICE operations, including 10,000 new officers over five years.
$14 billion for state and local enforcement, including a $10 billion state border security fund.
$7.8 billion for 3,000 new Border Patrol agents and $6.2 billion for surveillance technology and vetting systems.
$3.3 billion for immigration courts, with a cap of 800 immigration judges as of November 2028.²⁴

New fees also took effect: $100 to file an asylum application plus $100 annually while it is pending, a $250 visa bond for all nonimmigrant visa holders, $5,000 for noncitizens apprehended between ports of entry, and $5,000 for those ordered removed in absentia.²⁴ A 1 percent excise tax on remittance transfers paid in cash or physical instruments took effect January 1, 2026.¹⁶

Energy Provisions

The law rolled back or accelerated the expiration of several clean-energy tax credits from the Inflation Reduction Act of 2022. Electric vehicle credits for new, used, and commercial clean vehicles ended for vehicles acquired after September 30, 2025.¹⁶ The residential clean energy credit under Section 25D was terminated at the end of 2025.²⁵ For utility-scale wind and solar, production and investment tax credits are available only if the project is placed in service before 2028, unless construction began within 12 months of enactment. Other clean electricity projects phase out for facilities starting construction after 2033.²⁶

The clean fuel production credit under Section 45Z was extended through 2029, and the carbon capture credit under Section 45Q was preserved with a 2032 deadline, though new foreign entity restrictions were added. The hydrogen production credit deadline was pulled forward by five years, requiring construction to begin by the end of 2027.²⁷ On the fossil fuel side, the law repealed the methane emissions fee and authorized new oil and gas development on federal lands.¹³

Debt Ceiling and Deficit Impact

The law raised the federal debt ceiling by $5 trillion, to $41.1 trillion.²⁸ The CBO estimated the overall fiscal impact at a $3.4 trillion increase in the unified budget deficit over 2025 through 2034, reflecting a $4.5 trillion drop in revenues partially offset by $1.1 trillion in spending cuts.³ A separate CBO dynamic analysis, which tried to account for economic feedback effects, estimated a lower primary deficit increase of $2.3 trillion, though once additional interest costs were included, the total also reached $3.4 trillion.²⁹

Opposition and Criticism

Democrats framed the bill as a transfer of resources from safety-net programs to wealthier taxpayers, pointing to the roughly $1 trillion in Medicaid cuts, the $187 billion SNAP reduction, and CBO projections showing most of the deficit increase coming from tax cuts.³⁰

Some of the sharpest attacks came from Senate Republicans. Sen. Josh Hawley of Missouri said “you cannot take away health care from working people.” Sen. Ron Johnson of Wisconsin called the bill “immoral” and “grotesque.” Sen. Thom Tillis of North Carolina warned that the legislation “betrays the promise Donald Trump made” on health care. Multiple polls conducted in June 2025 showed a majority of voters opposed the bill.³⁰

1
ASTHO. One Big Beautiful Bill Act Law Summary
2
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3
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