US Senate approves Trump's tax reform
The Senate approved Trump's tight fiscal package, extending tax cuts and slashing Medicaid. The deficit will grow by $3.3 trillion over 10 years.
Photo of Kelly Sikkema in Unsplash
In a tense vote that lasted several hours, the U.S. Senate approved a controversial tax overhaul championed by former President Donald Trump on Tuesday. The measure, part of the package known as the "One Big Beautiful Bill," passed by a narrow 51-50 vote, with Vice President J.D. Vance casting the deciding vote. It now returns to the House of Representatives, where the outlook remains uncertain.
The reform extends the 2017 tax cuts and adds new benefits for tip income, overtime pay, and certain deductions. At the same time, it cuts public funding for Medicaid and food assistance, and authorizes spending increases for defense, border security, and immigration.
According to the Congressional Budget Office (CBO), the bill will increase the federal deficit by an estimated $3.3 trillion between 2025 and 2034. It is also expected to affect the health insurance of 11.8 million people by 2034, compared to previous estimates.
Political division
Moderate Democrats and Republicans criticized the package for its social cuts and its impact on the deficit. Senator Collins, for example, rejected the measure, calling the Medicaid cuts for rural communities "too drastic."
Both Trump and Senate Republican leader John Thune argue that the package "expands tax relief for workers" and will stimulate economic growth. Maya MacGuineas, chair of the Commission for a Responsible Budget, called the plan an "abdication of fiscal responsibility."
The bill remains on track: it must return to the House for final approval before July 4, the target date set by Trump.
What are the main benefits of the “Big Beautiful Bill” passed in the Senate?
- Extension of the 2017 tax cuts
It extends the tax cuts introduced during the Trump presidency for another 10 years, especially for individuals. - Tax exemptions on tips and overtime
Tips and overtime would be exempt from federal taxes to benefit the service sector. - Increases in standard deductions and child credits
Increases tax deductions and benefits for families with children. - Tax incentives for small businesses and entrepreneurs
Tax deductions and benefits are expanded for small business owners and self-employed workers. - Tax protection for retirees
Reduces the tax burden on pensions and early retirements for certain income brackets. - Tax credits for rural work and manufacturing
Establishes new tax reductions for companies operating in rural areas or reindustrialization zones. - Investment in defense and border security
Increases the military budget and expands funding for immigration control, including the construction of border infrastructure.
For more stories like this, follow More Latin.
Sources:
English 
Spanish