Understanding the New US Tax and Spending Law

Intermediate | July 11, 2025

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A Big Bill Signed into Law

Trump 2025 Tax Cuts and Social Program Changes

Recently, on July 4th, President Donald Trump signed a very important bill into law. It’s a large piece of legislation that makes some big changes to taxes and government spending programs. This bill has been a topic of much discussion and debate in the country.

Political Divide in Congress

The official name for it is sometimes called “The One Big Beautiful Bill.” It passed through Congress with mostly support from Republican lawmakers, while most Democrats were against it. The President and his party worked very hard to get a bill like this passed.

Changes to Your Money and Social Support

Making Tax Cuts Permanent

So, what exactly does this new law do? Well, it does two main things. First, it makes many of the tax cuts that were put in place back in 2017 permanent. This means people and businesses will continue to pay less in taxes than they would have if the old rules came back. The bill also adds some new tax breaks, like deductions for income from tips and overtime pay, and even for interest on loans for US-made cars.

Cuts to Social Support Programs

However, to help pay for these tax cuts and increased spending in other areas like defense and border security, the bill also makes significant cuts to some social programs. Programs like Medicaid, which helps with healthcare costs for people with low incomes, and SNAP, which helps families buy food, will see less funding. Experts say this could mean millions of people might lose their health insurance or receive less food assistance.

Mixed Reactions and Long-Term Impact

This law, titled “The One Big Beautiful Bill,” represents the centerpiece of Trump 2025 tax cuts and social program changes. This new law is quite long, almost 900 pages! It will affect different people in different ways. Supporters say it will help the economy grow and put more money in people’s pockets, especially for working families. But critics worry that the cuts to social programs will hurt vulnerable people the most and increase the national debt significantly over the next ten years.

Vocabulary

Legislation (noun): A law or a set of laws made by a government.
*Example: “Congress worked for months on this new legislation.”
Spending Programs (noun phrase): Government programs that provide money or services to people.
*Example: “Social security and healthcare are examples of government spending programs.”
Permanent (adjective): Lasting forever or for a very long time.
*Example: “The new law makes the tax cuts permanent.”
Deduction (noun): An amount that is taken away from a total, especially a sum of money taken from your pay or from the amount of tax you have to pay.
*Example: “The bill includes a new tax deduction for certain expenses.”
Medicaid (noun): A government program in the U.S. that provides healthcare for people with low incomes.
*Example: “Cuts to Medicaid could affect many families.”
SNAP (noun): Supplemental Nutrition Assistance Program; a program that helps people buy food, often called food stamps.
*Example: “Families who qualify for SNAP will receive monthly benefits.”
Funding (noun): Money provided, especially by an organization or government, for a particular purpose.
*Example: “The bill reduces funding for some social services.”
Vulnerable (adjective): Easily harmed or hurt.
*Example: “Critics worry the cuts will hurt vulnerable people.”
National Debt (noun phrase): The total amount of money that a country’s government has borrowed.
*Example: “Some economists expect the new law to add to the national debt.”
Critics (noun): People who express disapproval of someone or something.
*Example: “Critics of the bill say it favors the rich.”

Discussion Questions (About the Article)

What are the two main parts of the bill President Trump signed?
When was this bill signed into law?
Which groups supported the bill, and which groups were mostly against it?
What are some examples of new tax breaks mentioned in the article?
According to the article, what might be the effect of cuts to programs like Medicaid and SNAP?

Discussion Questions (About the Topic)

Why do governments collect taxes from people and businesses?
What do you think is more important: cutting taxes or funding social programs? Why?
How do government spending programs help people in a country?
Should governments try to reduce the national debt?
How do news articles about politics affect your understanding of what is happening in a country?

Related Idiom

“To tighten one’s belt”
Meaning: To spend less money because there is less available.
Example: Many families will have to “tighten their belts” because of the program cuts.

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This article was inspired by: Democracy Now!, July 7, 2025