Trump tax bill will add $2.4 trillion to the deficit and leave 10.9
million more uninsured, CBO says
[June 05, 2025]
By LISA MASCARO
WASHINGTON (AP) — President Donald Trump’s big bill in Congress would
unleash trillions in tax cuts and slash spending, but also spike
deficits by $2.4 trillion over the decade and leave some 10.9 million
more people without health insurance, raising the political stakes for
the GOP's signature domestic priority.
Republican leaders in Congress, determined to muscle the sweeping
package forward, had little to say after the analysis released Wednesday
by the nonpartisan Congressional Budget Office. GOP senators spent more
than an hour at the White House in what they called a robust afternoon
discussion with Trump.
“We’re committed to making a law that will make the lives of the
American people better,” Senate Majority Leader John Thune of South
Dakota said afterward. He vowed to "get this done one way or another.”
But Democrats angling to halt the One Big Beautiful Bill Act, named
after the president’s own catchphrase, piled on with relentless
opposition.
“In the words of Elon Musk, this bill is a ‘disgusting abomination,’”
said Rep. Brendan Boyle of Pennsylvania, the top Democrat on the House
Budget Committee, reviving the billionaire former Trump aide’s criticism
of the package.
The analysis comes at a crucial moment as Trump is pushing Congress,
where Republicans have majority control, to send the final product to
his desk to become law by the Fourth of July. The House passed the bill
last month by a single vote, but it's now slogging through the Senate,
where Republicans want a number of significant changes, including those
discussed with Trump.
And the politics are only intensifying.
Musk blindsided Congress with an all-out assault against the bill this
week, leaving House Speaker Mike Johnson rushing to do damage control.
The GOP speaker said he called Musk to discuss the criticism, but had
not heard back. Musk has threatened to use his political apparatus to go
after Republicans in the midterm elections.
“I hope he comes around,” Johnson, R-La., told reporters.
Hours later, Musk, whose business interests could be impacted by green
energy rollbacks in the bill, implored voters to call their
representatives and senators. “Bankrupting America is NOT ok!” he wrote
on social media, “KILL the BILL.”
Tax breaks, but also cuts to health care
The work of the CBO, which for decades has served as the official
scorekeeper of legislation in Congress, is closely watched by lawmakers
and others seeking to understand the budgetary impacts of the sprawling
1,000-page-plus package.
The bill includes roughly $3.75 trillion in tax cuts — extending the
expiring 2017 individual income tax breaks and temporarily adding new
ones that Trump campaigned on, including no taxes on tips. The revenue
loss would be partially offset by nearly $1.3 trillion in reduced
federal spending elsewhere, namely through Medicaid and food assistance.
As a result, some 7.8 million people would no longer have health
insurance with changes to Medicaid, including 5.2 million from the
proposed new work requirements on those nondisabled adults up to age 65,
with some exceptions, the analysis said. Some 1.4 million people who are
in the United States without legal status in state-funded health
programs would no longer have coverage.
Also, some 400,000 people would lose insurance coverage from the
termination of a medical provider tax that key Republicans, including
Sen. Josh Hawley of Missouri, want to keep in place to ensure rural
hospitals can keep paying their bills.
Republicans argue that their proposals are intended to strengthen
Medicaid and other programs by rooting out waste, fraud and abuse. They
want the federal funding to go to those who most need health care and
other services, often citing women and children.
But Senate Democratic Leader Chuck Schumer said those claims are bogus
and are simply part of long-running GOP efforts to repeal and replace
the Affordable Care Act, or Obamacare, as most states have expanded
Medicaid to serve more people under the program.
“They just want to strangle health care,” Schumer said.
Additionally, the CBO had previously estimated that nearly 4 million
fewer people would have food stamps each month due to the legislation’s
proposed changes to the Supplemental Nutrition Assistance Program, known
as SNAP, including new work requirements for some older Americans and
parents of school-age children. Some would see their benefits reduced by
about $15 by 2034, the CBO has said.
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Sen. Marsha Blackburn, R-Tenn., walks to board a bus to the White
House with other Senate Republicans for a meeting with President
Donald Trump on his spending and tax bill, Wednesday, June 4, 2025,
outside the U.S. Capitol in Washington. (AP Photo/Julia Demaree
Nikhinson)
Republicans criticize the CBO
Ahead of the CBO’s release, the White House and Republican leaders
criticized the budget office in a preemptive campaign designed to sow
doubt in its findings.
Thune said the CBO was “flat wrong” because it underestimated the
potential revenue growth from Trump’s first round of tax breaks in 2017.
The CBO last year said receipts were $1.5 trillion, or 5.6% greater than
predicted, in large part because of the “burst of high inflation” during
the COVID-19 pandemic in 2021.
White House Budget Director Russ Vought said when you adjust for
“current policy,” which means not counting some $4.5 trillion in
existing tax breaks that are simply being extended for the next decade,
the overall package actually doesn’t pile onto the deficit. He argued
that the spending cuts alone, in fact, help reduce deficits by $1.4
trillion over the decade.
But Democrats and even some Republicans call that “current policy”
accounting move a gimmick. Still, it’s the approach Senate Republicans
intend to use during their consideration of the package to try to show
it does not add to the nation’s deficits. Vought argued that the CBO is
the one using a “gimmick” by tallying the costs of continuing those tax
breaks that would otherwise expire.
“Russ is right,” Johnson, the House speaker, posted on social media.
“Our One Big Beautiful Bill will REDUCE the deficit WHILE delivering on
the mandate given to us by the American people."
White House press secretary Karoline Leavitt has also suggested that the
CBO’s employees are biased, even though certain budget office workers
face strict ethical rules — including restrictions on campaign donations
and political activity — to ensure objectivity and impartiality.
What's at stake
The individual income tax breaks that had been approved during Trump's
first term in the White House will expire in December if Congress fails
to act, in what Republicans warn would be a massive tax hike on many
American households.
During the meeting at the White House, Trump pushed senators for his
priorities — the new tax breaks on tips, overtime pay and others — while
some of the most conservative GOP senators pushed for steeper spending
cuts to stem deficits.
And they joked about Musk.
Trump briefly brought up Musk, senators said. GOP Sen. Roger Marshall
described it as "a laughing conversation for 30 seconds.”
The package also includes a massive buildup of $350 billion for border
security, deportations and national security that is central to the GOP
agenda, as well as a $4 trillion increase to the nation’s $36 trillion
debt limit, which the Treasury Department says is needed by this summer
to pay the nation’s bills.
CBO aims for impartiality
More than 50 years ago, the CBO was established by law after Congress
sought to assert its control, as outlined in the Constitution, over the
budget process.
Staffed by some 275 economists, analysts and other employees, the CBO
says it seeks to provide Congress with objective, impartial information
about budgetary and economic issues.
Its current director, Phillip Swagel, a former Treasury official in
Republican President George W. Bush’s administration, was reappointed to
a four-year term in 2023.
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Associated Press writers Kevin Freking, Darlene Superville, Joey
Cappelletti, Michelle Price and Leah Askarinam contributed to this
report.
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