U.S. Congress Passes $3.4T Tax, Debt Limit Increase Bill

On July 3, 2025, the U.S. House of Representatives passed the One Big Beautiful Bill Act (H.R. 1) by a narrow 218-214 vote, following Senate approval with Vice President J.D. Vance casting the tie-breaking vote. The 870-page bill renews many provisions of the 2017 Tax Cuts and Jobs Act and introduces significant tax and policy changes, including a $5 trillion increase in the national debt limit, which is projected to raise deficits by $3.3 to $3.4 trillion over the next decade. Key provisions include permanent extensions of business tax benefits such as research and experimentation expense deductions, bonus depreciation, and changes to international tax rules, while some proposed taxes, like those on litigation financing and carried interest, were omitted. The bill also imposes excise taxes on investment income for wealthy colleges and enacts major federal health program spending cuts exceeding $1.1 trillion over ten years, including reductions to Medicaid, Medicare, and Affordable Care Act subsidies, alongside new allowances for health savings accounts to be used with a broader range of health plans. President Trump is expected to sign the bill at a July 4 ceremony; however, the bill has faced criticism from some Republican lawmakers and prominent crypto figures like Elon Musk, who oppose the significant debt increase. Despite this, the legislation is seen as expanding options for telehealth coverage and health savings accounts, with supporters highlighting the increased flexibility for millions of Americans.