Washington, D.C. — July 3, 2025 — The U.S. House of Representatives on Thursday advanced a sweeping tax reform package, marking a crucial step toward one of President Donald Trump's top legislative priorities since his return to office earlier this year. Lawmakers voted 228-207 in favor of the bill, which includes significant changes to the federal tax code and is expected to impact millions of Americans and businesses.
Key Provisions in the Tax Bill
- Individual Income Tax Cuts: The legislation reduces rates for most income brackets, with temporary provisions set to expire in 2030.
- Corporate Tax Rate Reduction: The corporate tax rate will drop from 21% to 18%, effective January 2026.
- Child Tax Credit Expansion: The child tax credit is increased to $3,000 per child for families meeting income thresholds.
- Small Business Deductions: Small businesses will see an expanded pass-through deduction, aiming to stimulate entrepreneurial growth.
- State and Local Tax (SALT) Cap Adjustment: The SALT deduction cap is raised to $15,000 for individuals and $30,000 for married couples.
Next Steps in the Senate
The bill now heads to the Senate, where Republican leaders have expressed optimism but face a narrower margin. Senate Majority Leader Mitch McConnell stated that a final vote could come as early as next week, with negotiations ongoing over several provisions, including the SALT cap and business tax credits.
Political Implications and Trump’s Agenda
The passage in the House represents a significant victory for President Trump, who campaigned in 2024 on a promise to deliver tax relief and economic growth. With the 2026 midterm elections already looming, Republicans are touting the bill as evidence of effective governance, while Democrats argue it primarily benefits corporations and wealthy individuals.
White House officials say the tax cuts will "put more money in Americans' pockets" and "boost job creation," while Democratic leaders, including House Minority Leader Hakeem Jeffries, have criticized the bill for "exacerbating income inequality." The Congressional Budget Office (CBO) estimates the bill could add $1.2 trillion to the national deficit over the next decade.
Market and Economic Reactions
U.S. stock markets responded positively to news of the bill’s passage, with the S&P 500 up 0.7% by midday. Economists remain divided, with some forecasting increased consumer spending and business investment, while others warn of long-term fiscal risks.
Stay Tuned for Live Updates
Negotiations in the Senate are set to intensify after the July 4th holiday. Follow this page for real-time updates as the legislative process continues and President Trump closes in on what could be his first major legislative victory of his new term.
