CED Newsletters & Policy Alerts

Policy Alert: CBO Scores House Reconciliation Bill

June 05, 2025

Action: Cost Estimate “Estimated Budgetary Effects of H.R.1, the One Big Beautiful Bill Act”

What it does: This week, the Congressional Budget Office (CBO) released its official scoring of the House reconciliation bill Republicans are using to advance the President’s legislative agenda. In conjunction with staff from the Joint Committee on Taxation (JCT), CBO projects that the reconciliation bill that passed the House, including tax provisions, new outlays, and spending reductions, will increase the deficit by more than $2.4 trillion between 2025 and 2034.

CBO analyzed the bill by titles and committees of jurisdiction. The title of the bill with the largest deficit impact is the tax policy changes under the jurisdiction of the Committee on Ways and Means, including extensions of the expiring provisions of the Tax Cuts and Jobs Act and new tax cuts the President has proposed. CBO projects these tax policy changes will increase the deficit by more than $3.7 trillion over the next decade.

The bill also contains increases in outlays for defense spending under the Committee on Armed Services ($144 billion over 10 years) and border security spending under the Committees on Homeland Security ($79 billion over 10 years) and the Judiciary ($73 billion over 10 years). To offset the deficit impact of these revenue losses and higher outlays, the bill includes significant cuts to health, education, and social safety net spending under the jurisdictions of the Committees on Energy and Commerce (deficit reduction of $1.1 trillion over 10 years), Education and Workforce (deficit reduction of $349 billion over 10 years), and Agriculture (deficit reduction of $238 billion over 10 years).

Key Insights

• CBO also released its projections of the debt-service effects from the House’s reconciliation bill. CBO estimates the bill would increase debt-servicing costs by $551 billion over the next decade, for a total increase of nearly $3 trillion of deficits between 2025 and 2034. As a result, CBO projects that the debt held by the public at the end of 2034 would increase from the current estimate of 117.1% of GDP to 123.8% of GDP.
• Several provisions of the House bill that will likely be debated in the Senate include cuts to the Medicaid program and Affordable Care Act exchanges ($900 billion over 10 years) and cuts to the Supplemental Nutrition Assistance Program ($295 billion over 10 years).
• The Senate is also likely to examine the increased cap on the state and local tax (SALT) deduction. The higher SALT cap of $40,000 for those making under $500,000, negotiated before the House floor vote, will only bring in $787 billion in revenue over 10 years, compared to the originally proposed SALT cap of $30,000 for those making under $400,000 that JCT estimated would bring in more than $900 billion over 10 years.
• As a comparison with outside models, the Penn Wharton Budget Model estimates the House-passed reconciliation bill would increase primary deficits by $2.8 trillion over 10 years, rising to $3.2 trillion over the next decade under dynamic scoring. The Yale Budget Lab projects the House reconciliation bill would increase primary deficits by $2.4 trillion over 10 years and net interest outlays by $515 billion over 10 years, for a total deficit impact of over $2.9 trillion.