Senate leaders advanced President Trump’s “One Big Beautiful Bill” on Tuesday in a vote that moved the megabill one step closer to becoming law despite three Republican defections, leading to a 50-50 tally that required Vice President JD Vance to break the tie in Trump’s favor.
The process proved exceptionally contentious in recent days, largely over healthcare provisions that are set to extract hundreds of billions in government savings but cause millions to lose coverage.
This portion of the bill fueled two of the Republican no votes — Thom Tillis of North Carolina and Susan Collins of Maine — and led to last-minute concessions to Lisa Murkowski of Alaska as a way of securing her yes vote.
The third Republican no vote was Rand Paul of Kentucky, who objected to the inclusion of a $5 trillion debt ceiling increase in the package.
Medicaid and that debt ceiling increase were just two pieces of a complex, nearly 900-page bill that is set to reshape whole swathes of the US economy, especially among taxes, energy, and healthcare.
Sen. Lisa Murkowski of Alaska, center, is seen on Capitol Hill during final negotiations at the US Capitol on July 1. (Andrew Harnik/Getty Images) ·Andrew Harnik via Getty Images
Clean energy companies — especially electric-vehicle maker Tesla (TSLA) — were perhaps paying the closest attention. Government support for EVs and solar companies are set to be eliminated as tax credits phase out, but a last-minute change appeared to remove what could have been a new headwind in the form of an excise tax.
Tesla CEO Elon Musk emerged during final negotiations as the top business-world critic of the bill, attacking the price and how it treats clean energy. He said earlier Tuesday that the $3.3 increase in debt expected from the bill makes a “mockery” of his work at the Department of Government Efficiency (DOGE).
Economists have likewise noted the final price tag, which could top $4 trillion, and critiqued an accounting gimmick Republicans employed to hide much of that red ink.
Silicon Valley also has questions after a last-minute change stripped a closely-watched artificial intelligence provision from the bill.
But a range of GOP priorities that were included — from increased funding for border enforcement to money for America’s 250th anniversary celebration next year — pushed the bill over the line, with many in corporate America in favor and focused on the tax piece.
The Business Roundtable, which represents CEOs in Washington, D.C., said the bill would “send a swift, decisive signal that America will remain a premier destination for businesses to invest, hire and grow.”
President Trump on Tuesday morning expressed confidence it would reach his desk soon, calling it the “greatest bill ever passed.”
The legislation now moves back to the US House of Representatives. House GOP leaders reaffirmed after the vote that their goal is to have the bill to the president’s desk by July 4th with the first step likely to happen this afternoon in the House Rules committee.
That comes even as the conservative Freedom Caucus and other members sent signs they aren’t happy with the changes. One recent comment from Rep. Chip Roy of Texas, who sits on the Rules committee, read “we’ve got to deliver for the President—but it has to be the right bill.”
For now, here is a closer look at three ways the current version of the bill, as blessed by the Senate, would impact the business world.
Senate Majority Leader John Thune near the Senate floor on July 1. (Alex Wong/Getty Images) ·Alex Wong via Getty Images
A centerpiece of the bill — and far and away the source of the most expensive provisions — surrounds taxes.
The bill’s main impetus has long been to permanently extend tax cuts for individuals contained in the 2017 Tax Cuts and Jobs Act, which Trump signed into law on a temporary basis during his first term as president.
The bill would represent a continuation of the status quo for taxpayers. As one example, if the bill is enacted, America’s highest earners will see a continued top rate of 37%.
The bill also provides new tax credits for individuals by fulfilling signature Trump campaign promises — albeit slightly less fulsomely than in the House version — to eliminate taxes on tips, overtime, and car loan interest. It also offers an expanded standard deduction for seniors after Trump promised to eliminate taxes on Social Security benefits.
Employees would be able to deduct up to $25,000 annually for tips and overtime in the Senate version, in contrast to the House’s approach of 100% deductibility under certain income limits.
Business owners, meanwhile, are keenly focused on a series of tax deductions that will reinstate credits for corporations for things like property depreciation, capital investments, new factory construction, interest expenses, and research and development costs.
Many of these provisions were present in the House version, but only temporarily. Permanency was a key Senate priority and is now included in the bill, even as it increased the price tag.
Senate Finance Committee chair Mike Crapo shepherded the tax changes and celebrated the passage with a statement after the vote that said corporate provisions give “businesses the certainty they need to make the long-term investments that power economic growth.”
The bill also makes permanent the pass-through deduction at a rate of 20%. That deduction — formally known as the 199A deduction — is focused on often smaller businesses organized as S corporations or partnerships.
The Senate version also includes an array of other tax changes, including a $40,000 annual deduction for state and local taxes (SALT) for some taxpayers in the coming years, enhanced credits for “opportunity zones,” and so-called MAGA accounts.
The effect on the energy sector could be profound, especially after a last-minute series of changes turned the bill even further against the clean energy industry while offering new support for fossil fuels.
The bill has long been expected to phase out Biden-era clean energy tax credits, but the final Senate bill now aims to shut them down faster than expected.
The proposal to eliminate EV credits is immediate and would take effect on September 30 of this year.
A late addition to the bill also raised worries in the form of a new tax on wind and solar projects completed after 2027 if a certain amount of supplies came from China. But those objections appear to have led to a moderation, with the final draft quietly removing that excise tax.
It gave clean energy advocates some solace, with Democratic Sen. Ed Markey of Massachusetts posting that “we just forced them to take it out.”
President Trump speaks to the media before a trip to Florida on July 1. (AP Photo/Mark Schiefelbein) ·ASSOCIATED PRESS
At the same time, new last-minute inducements were unveiled for fossil fuels, including one classifying coal as a critical mineral for a government manufacturing credit.
“We’re doing coal,” Trump said in an interview released over the weekend on Fox News’ “Sunday Morning Futures,” where he also called solar energy projects “ugly as hell.”
It was a mix that led Musk and others to predict that it would cut off clean energy, hurt the overall energy grid, and perhaps lead to higher utility bills.
The bill is also set to implement major changes to the healthcare system.
Healthcare negotiations went until nearly the literal last minute with the overall package is set to trim the government’s Medicaid spending by around $900 billion in the years ahead.
Corners of the sector, like rural hospitals, are set to be most directly impacted.
Republican Sen. Collins of Maine explained her no vote afterwards as driven “primarily from the harmful impact [the bill] will have on Medicaid, affecting low-income families and rural health care providers like our hospitals and nursing homes.”
And the bottom line for patients — according to an accounting from the Congressional Budget Office that came in over the weekend — is that 11.8 million additional Americans would become uninsured by 2034 because of the healthcare provisions.
Some that lose coverage would be illegal immigrants, as Republicans often point out, but millions of US citizens are expected to lose coverage if the bill is enacted because of additional requirements to qualify for coverage.
Capitol Hill has yet to offer its final verdict on the package, with House deliberations still in the offing, but the healthcare provisions appearing to erode popular support for the package.
A series of polls has shown declines as the focus has turned to healthcare. Even a recent Fox News national poll found a 21-point gap between those who say they are opposed (59%) and those who say they are in favor (38%).
But Republicans are celebrating a significant win Tuesday with Treasury Secretary Scott Bessent adding in his own statement “we encourage House Republicans to act quickly.”
This story has been updated with additional developments.
Ben Werschkul is a Washington correspondent for Yahoo Finance.
