H.R. 1 Analysis

H.R. 1 Analysis

Senate Bill Report

H.R. 1

Passed by Senate: July 1, 2025

Title: One Big Beautiful Bill

Brief Description: The Big Beautiful Bill is meant to change four different areas: taxes, federal spending, immigration enforcement, and social programs for the remainder of Trump’s second term.

Sponsors: Jodey C. Arrington

Brief History:

Committee Activity:

Passed Senate 6/1/25, 51–50

SENATE BUDGET COMMITTEE

Majority Report: do pass

Signed by: John Barrasso, Marsha Blackburn, John Boozman, Mike Braun, Katie Britt, Shelley Moore Capito, Bill Cassidy, John Cornyn, Tom Cotton, Kevin Cramer, Mike Crapo, Ted Cruz, Steve Daines, Deb Fischer, Lindsey Graham, Chuck Grassley, Bill Hagerty, Josh Hawley, John Hoeven, Cindy Hyde-Smith, Ron Johnson, John Kennedy, James Lankford, Mike Lee, Cynthia Lummis, Roger Marshall, Mitch McConnell, Jerry Moran, Markwayne Mullin, Lisa Murkowski, Mitt Romney, Mike Rounds, Marco Rubio, Rick Scott, Tim Scott, Pete Ricketts, Dan Sullivan, John Thune, Tommy Tuberville, Todd Young, James Risch, Ted Budd, Roger Wicker, Eric Schmitt, Joni Ernst, Jim Baird.

Background: What the Big Beautiful Bill does is implement new policies to adjust the federal budget by altering funding for social programs, border security and enforcement, remittance taxes, and increasing the debt ceiling, alongside substantial tax reforms (Congress.gov, 2025).

The Big Beautiful Bill makes major shifts to Medicaid by restructuring the program through tighter eligibility standards and cutting its funds by 12% over time. It establishes stricter work requirements for individuals aged 18–64, institutes heavier requirements for Temporary Assistance for Needy Families (TANF) parents receiving assistance, and places limits on some types of cash benefits. Furthermore, it reduces funding for rental assistance and creates more rigorous income verification procedures to check tenant eligibility. Overall, supporters of the bill argue it reduces federal spending and encourages work, while critics argue it could cause millions of Americans to lose healthcare coverage and food assistance.

The bill also greatly increases the budget for border security and immigration enforcement by expanding border security measures, with $150–$170 billion being invested to build and upgrade infrastructure along the border. It provides Immigration and Customs Enforcement (ICE) with a major budget raise, increased staffing, new detention facilities, and additional courts to manage immigration enforcement and deportations. Overall, this ramps up deportation efforts against undocumented immigrants, which proponents argue will strengthen national security, while opponents argue it is too costly.

The remittance tax provision in the Big Beautiful Bill creates a new 1% fee on many types of money transfers sent from the U.S. to other nations. It is designed to raise federal revenue to offset the bill’s tax cuts and encourage the use of regulated banking channels. Supporters state it will fund government programs and reduce untracked international transfers, while critics argue it harms immigrant families and pushes capital into less safe, unregulated transfer channels.

The Big Beautiful Bill raises the debt ceiling by about $5 trillion so the government can borrow enough money to meet existing obligations, as well as pay for the bill’s major tax cuts and border-security expansions. Supporters say raising the debt ceiling prevents default and keeps the government stable, while critics argue it adds trillions to the national debt and increases long-term deficits.

To alter the tax code, the bill cuts taxes on workers, families, and seniors, which is intended to reduce the cost of living for the American people. It makes tips and social security benefits tax-free, allows individuals to keep more of their earnings, increases the child tax credit, raises the State and Local Tax (SALT) deduction cap, and introduces a small tax on certain international affairs, lowering overall taxes over time.

Despite all of these measures within the Big Beautiful Bill meant to reduce federal expenditures, the federal budget is still projected to expand, raising the national debt (Congress.gov, 2025).

Alongside lower taxes comes the decrease of funding for social programs such as Medicaid, alongside stricter eligibility requirements that reduce the number of people served. However, these spending cuts are still too small compared to the magnitude of the tax cuts and border protection spending, making very little impact on lowering the federal budget.

Even with lower revenue from taxes and reduced spending on social programs, the government will still have to pay a hefty $150–$170 billion for border security, including wall construction and building new detention centers. This takes a lot of capital that the government could otherwise use for alternate priorities. Ultimately, these attempts at balancing the federal budget are projected to add around $2.8–$3 trillion to the national debt (Congress.gov, 2025).

Some proposed improvements to ensure the bill fulfills its intended purposes include making tax cuts more balanced across all income classes, adding stronger protections for vulnerable individuals at risk of losing healthcare, making border spending more transparent, diversifying funding sources, strengthening immigration-court capacity, and creating stricter oversight systems to ensure the bill works as intended.

Summary of Bill: Early into President Trump's second term, many economic and tax policies had to be renewed or changed. To address this, the Big Beautiful Bill was created to reshape the economic landscape of his second term, addressing prior problems including rising costs of living, a growing federal deficit, and immigration challenges.

References

Congress.gov. (2025). H.R. 1 - Lower Energy Costs Act / Tax Cuts and Jobs Amendments Act. Library of Congress. https://www.congress.gov/bill/119th-congress/house-bill/1