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The Senate-Passed “One Big Beautiful Bill Act” (H.R.1)

The Senate approved its substitute version of H.R.1 on July 1 2025, 51-50, with Vice-President J.D. Vance breaking the tie and Senator Marsha Blackburn’s 99-1 amendment stripping the draft’s 10-year moratorium on state A.I. regulation ^[1]^[2]^[3]^[4]. The House must now choose to (1) accept the Senate bill unchanged, (2) request a conference, or (3) amend and return it.

Below is an in-depth look at what is now in the bill and what the Congressional Budget Office (CBO) says it would cost.

Overview

The 940-page Senate substitute:

· Makes most 2017 Tax Cuts and Jobs Act provisions permanent; creates new breaks for overtime, tips and Social-Security wages; raises the SALT cap to $40,000 for five years ^[5]^[6].

· Offsets those revenue losses mainly with deep reductions to Medicaid, SNAP, the Affordable Care Act, clean-energy incentives and several Inflation Reduction Act programs ^[7]^[8]^[9].

· Raises the statutory debt ceiling by $5 trillion through FY2036 ^[5].

· Adds a $77 billion defense plus border-security package and large aerospace, missile-defense and shipyard investments ^[7]^[10]^[5].

· Reauthorizes FCC auction authority, mandates a 600 MHz spectrum reallocation, and removes the controversial federal pre-emption of state A.I. rules (via Blackburn Amendment 2814)^[2]^[3].

· Includes major higher-education changes: ends subsidized loans, resets loan limits, narrows Pell eligibility and imposes institutional “risk-sharing” payments ^[7].

· Tightens Medicaid/CHIP eligibility, mandates six-month redeterminations for expansion enrollees, imposes work requirements and cost-sharing, and bars federal funding for most gender-transition procedures ^[7]^[8].

How the Senate Version Differs from the House Version

Area	House-Passed Text (5/22/25)	Senate Changes (7/1/25)	Net Effect
A.I. Moratorium	Ten-year ban on state or local A.I. regulation^[7]	Removed (Blackburn Amdt. 2814, 99-1)^[2]^[3]	Restores state police powers
Medicaid Cuts	$863 billion ten-year gross cut^[11]	$1.02 trillion gross cut^[8]	Deeper reductions
Tax Baseline	Current-law score: +$2.4 trillion deficit^[12]	Current-law score: +$3.3 trillion deficit^[13]^[6]	Higher cost
SALT Cap	$40 k cap for 10 yrs^[7]	Cap sunsets after 5 yrs^[5]	Raises revenue in later years
SNAP SUA “Heat-and-Eat”	Eliminated for all households^[7]	Restored for elderly/disabled only (Klobuchar amendment failed)^[3]	Slightly moderated
Defense Add-Ons	$70 b boost over 10 yrs^[7]	Trimmed to $64 b; adds $10 b for barracks^[14]	Modest reduction
Energy	Repeals most IRA clean-energy credits^[7]	Retains 45X hydrogen PTC; kills solar/wind ITCs (Rosen, Hickenlooper, Shaheen fails)^[3]	Still large rollback

Fiscal Scorecard (CBO, June 29 2025, Current-Law Baseline)

Category (Titles)	2025-2029 Net ($ billions)	2025-2034 Net ($ billions)	Comments
Title I – Agriculture & Nutrition	–47,642^[15]	–120,250^[15]	SNAP work rules, state match, SUA limits
Title II – Armed Services	+130,659^[15]	+149,542^[15]	Shipbuilding, Indo-Pacific, barracks
Title III – Banking/Housing	+402^[15]	–1,668^[15]	Small offsets from crypto AML rules
Title IV – Commerce, AI, Spectrum	–4,347^[15]	–41,884^[15]	Repeals IRA EV credits; spectrum auction revenue
Title V – Energy & Natural Resources	–78,651^[15]	–236,100^[15]	SPR refill, LNG fees, delays drawdowns
Title VI – Environment & Public Works	–9,814^[15]	–94,778^[15]	Repeals Greenhouse Gas Reduction Fund, port rebates
Title VII – Finance (Tax)	+3,704,938 ^[16]^[6]	+3,485,000 ^[16]	Makes TCJA permanent, new credits
Total Deficit Impact	+3,695,545	+3,299,862	Revenues –$4.5 T; Outlays –$1.2 T^[6]

Positive numbers increase the deficit; negative numbers reduce it. All figures relative to January 2025 current-law baseline.

Alternative “Current-Policy” Score: Senate Republicans asked CBO to score the bill assuming the 2017 tax cuts are already permanent. On that basis the package reduces deficits by $507.6 billion over 2025-34 ^[6]^[13]. However, that metric is used only for enforcement, not for comparison with other legislation.

Title-by-Title Synopsis

Agriculture, Nutrition and Rural Development

· SNAP Overhaul: Extends ABAWD work rules up to age 65; limits child-care exemptions to kids <7; slashes state discretionary exemptions to 1%; blocks “heat-and-eat” unless elderly/disabled; zero-dollar payment-error tolerance ^[7].

· State Share: Introduces sliding state match (5%-25%) of benefit costs tied to payment-error rates ^[7].

· Farm & Rural Programs: Re-authorizes commodity, crop-insurance, conservation and export-promotion programs through 2031, rescinding unspent IRA conservation dollars ^[7].

Armed Services

Adds $64 b (2025-29) for Barracks 2030, naval shipbuilding, missile-defense, AI-enabled unmanned systems, Indo-Pacific posture, and SOCOM modernization ^[7]^[10]^[5].

Education & Workforce

· Ends subsidized Stafford and grad PLUS loans after July 1 2026; caps lifetime borrowing at $200,000; institutes two repayment plans only ^[7].

· Creates institutional risk-sharing payments pegged to non-repayment rates; repeals 90/10 and gainful-employment rules ^[7].

· Funds new Workforce Pell for short-term credentials; increases Pell appropriations FY 2026-28.

Finance (Tax)

· Permanent TCJA Extensions: Individual rate cuts, pass-through 199A deduction, doubled estate tax exemption, child-tax-credit expansion, AMT repeal, etc.^[5]^[6].

· SALT Cap: $40,000 through 2029 then expires, raising revenue later ^[5].

· New exclusions for tip and overtime income (2026-28) and Social-Security wages (caps at $147,000) financed by broader base-erosion offsets ^[5].

Energy & Environment

· Repeals nearly every Inflation Reduction Act clean-energy credit except Section 45X hydrogen production ^[9]^[3]; rescinds EPA climate-justice grants; establishes LNG export fees and “De-risking Compensation Fund.”

· Cancels EV charger, heavy-duty truck, port-emissions and greenhouse-gas monitoring grants ^[9]^[17].

Commerce, Science & Transportation

· Spectrum: NTIA must identify 600 MHz for licensed auction; FCC auction authority extended to 2034 ^[18]^[5].

· A.I. Section Removed: 10-year pre-emption struck by Blackburn amendment, preserving state regulatory authority ^[2]^[3].

Health & Medicaid

· Six-Month Redeterminations, Work Requirements & Premiums: Expansion-population adults must re-verify and document 80 hours work/service or pay up to $35 copays beginning FY 2029 ^[7]^[8].

· Provider-Tax Clampdown & Payment-Rate Caps: Limits provider-directed payments to 100%-110% of Medicare ^[7].

· Gender-Affirming Care Ban: No federal Medicaid/CHIP funds for most gender-transition surgeries or drugs except narrow exceptions ^[7].

· ACA exchanges barred from covering gender-transition services as “essential health benefits” and must verify income upfront ^[7].

Major Take-Away Numbers

Metric	House-Passed Version	Senate-Passed Version
10-yr deficit change (current-law)	+$2.4 trillion^[12]	+$3.3 trillion^[13]^[6]
Revenue change	–$3.67 trillion^[19]	–$4.5 trillion^[6]
Spending change	–$1.25 trillion^[19]	–$1.2 trillion^[6]
Projected uninsured (2034)	+10.9 million^[19]	+11.8 million^[13]^[20]
Gross Medicaid/CHIP cuts	$863 billion^[11]	$1.02 trillion^[8]
Medicaid work-requirement savings	$109 billion (House est.)^[7]	$145 billion (Senate est.)^[8]

What Happens Next

1. House Vote: Speaker Mike Johnson recalled members for a July 2 vote. He can:

o Concur: Send the Senate bill to the President by the July 4 target, but risk Freedom Caucus revolt over larger deficits and deeper Medicaid cuts.

o Amend/Request Conference: Delay enactment, risking market anxiety over debt-limit timing.

2. Byrd Rule Scrubbing: Senate parliamentarian has already ruled the substitute in order, but any House changes would face renewed Byrd Rule scrutiny ^[1]^[14].

3. CBO Update: A formal conference report would require a fresh score. Minor tweaks could push the bill further above the $3.3 trillion mark unless offset.

Bottom Line

The Senate-passed “One Big Beautiful Bill” is even larger—and costlier—than the House version. It would:

· Permanently extend expiring Trump tax cuts,

· Offset only a quarter of the lost revenue with aggressive reductions to Medicaid, SNAP and climate programs,

· Add $3.3 trillion to deficits over 2025-34 under conventional scoring, and

· Kick nearly 12 million Americans off health coverage by 2034.

Whether the House will accept those changes or insist on paring them back will determine how (and if) the reconciliation package clears Congress in time for President Trump’s July 4 deadline.

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