At a Glance
- President Trump’s tax cuts made permanent on July 4, 2025
- Congress allocated $150B to the Pentagon and $170B to ICE, sparking controversy
- 22 federal regulations were repealed, breaking a record
Why it matters: These moves reshape the federal budget, immigration enforcement, and regulatory landscape, affecting millions of Americans.
The Republican-led Congress completed a busy first year of President Donald Trump’s second term in 2025, passing landmark legislation that extends tax cuts, boosts defense and immigration spending, slashes regulations, and reshapes Senate procedures.
Making Trump’s Tax Cuts Permanent
On July 4, the House and Senate approved the “big, beautiful bill” that extended the 2017 tax cuts until 2035. The bill was passed with only Republican votes and was signed into law by Trump. He celebrated the extension with the slogan “America’s winning, winning, winning like never before,” adding that the tax cuts were now permanent.
President Trump stated:
> “America’s winning, winning, winning like never before.”
> “We have officially made the Trump tax cuts permanent.”
The law also includes a deduction for tipped workers, a tax break for tipped workers, a deduction for seniors, and “Trump Accounts” for newborns. The Congressional Budget Office projects a $4.5 trillion savings over the next decade, though Democrats say the benefit is skewed toward high earners. Representative Mike Flood was heckled during a town hall in Lincoln, Nebraska, over cuts to government services.
- Deduction for tipped workers
- Tax break for tipped workers
- Deduction for seniors
- “Trump Accounts” for newborns
Trillion-Dollar Pentagon and Mass Deportations
The law also adds $150B to the Pentagon and authorizes more than $170B for immigration enforcement, including hiring ICE agents and conducting raids. The combined defense spending, including the $900B National Defense Authorization Act, tops $1 trillion for the first time. The bill also cuts $1 trillion from Medicaid and slashes clean-energy funding.
The legislation has drawn criticism from Democrats over the large cuts to health care and energy programs.
- $150B Pentagon budget
- $170B ICE enforcement
- $1 trillion Medicaid cuts
- Reduced clean-energy funding
Repealed a Record Number of Regulations
Using the Congressional Review Act, Republicans fast-tracked 22 CRA resolutions that Trump signed into law, surpassing the 20 rules repealed before 2025. The CRA bypasses the 60-vote filibuster, making it difficult for Democrats to block. The EPA’s endangerment finding was among the regulations targeted, and other rules covered consumer protection, education, energy, and cybersecurity.
| Year | Resolutions Repealed |
|---|---|
| 2025 | 22 |
| Before 2025 | 20 |
Weakened Minority Power in the Senate
In September, Republicans used the “nuclear option” to change Senate rules, allowing executive nominations to be confirmed en bloc. They confirmed 48 nominees that month and an additional 97 before the year ended. They also expanded the 51-vote threshold to approve a $0 price tag on $3.4T in tax cuts and ignored the parliamentarian’s advice on CRA limits.
Despite these changes, the 60-vote rule remains for most other legislation.
- “Nuclear option” for nominations
- 48 + 97 nominees confirmed
- Expanded 51-vote threshold for tax cuts
Key Takeaways
- Trump’s tax cuts extended and projected to save $4.5 trillion over ten years.
- Defense and immigration budgets received a combined $320B boost.
- 22 federal regulations repealed, breaking the previous record.
These actions set a new trajectory for federal policy and budget priorities, with lasting impacts on tax policy, defense spending, immigration enforcement, regulation, and Senate procedures.
