A look at the key items in Trump's 'big, beautiful bill'

House Speaker Mike Johnson led the charge to pass Republican's "big, beautiful bill"

Republicans in the US Senate have unveiled their version of a sprawling tax and spending bill, after it narrowly cleared the House by a single vote roughly two weeks ago.

Their first draft of the so-called "big, beautiful bill" has mostly kept House Republicans' provisions intact but with some notable differences, including increased cuts to Medicaid.

Although the bill has been heavily endorsed by President Donald Trump, Republicans have been torn over how to fund many of the proposed tax cuts which the Congressional Budget Office estimates will increase the federal debt by nearly $3tn (£2.34tn) over the next decade.

Senate Republicans are now racing to finalise an agreed version of the bill before it can reach the floor for a vote ahead of a self-imposed 4 July deadline to deliver it to Trump's desk.

Here is a look at some of the key items in the bill.

No tax on Social Security

On the campaign trail, Trump vowed to eliminate taxes on Social Security income - monthly payments to people with disabilities and older adults.

The House bill fell short of delivering on that promise, but it did temporarily increase the standard deduction of up to $4,000 (£2,983) for individuals 65 and over. That deduction would be in place from 2025 to 2028.

The deduction extensions begin to decrease after $150,000 for married taxpayers filing jointly and $75,000 for individual filers.

Senate Republicans are also looking to extend Social Security tax breaks and have proposed an increase that would grant a $6,000 tax deduction for older Americans.

More Medicaid requirements

To help finance tax cuts elsewhere, Republicans have added additional restrictions and requirements for Medicaid, the health care programme relied upon by millions of elderly, disabled and low-income Americans.

Changes to Medicaid - one of the biggest components of federal spending - was a major source of political strife that caused significant disagreement among lawmakers.

One of the changes are new work requirements for childless adults without disabilities. To qualify, the bill says, they would be required to work at least 80 hours per month beginning December 2026.

Another change to the programme was requiring re-enrolment to shift from once per year to every six months. Enrolees will also have to provide additional income and residency verifications.

The Senate proposal puts even more restrictions on Medicaid, which is likely to cause more headaches for Republicans when the bill returns to the House.

Their version proposes to lower provider taxes - which states use to help fund their share of Medicaid costs — from 6% to 3.5% by 2031.

It also proposes tightening eligibility requirements so that adults with children aged 14 and over would need to work or volunteer at least 80 hours a month.

The Senate Medicaid work requirement is said to be the strictest ever proposed by Republicans, raising the odds that large numbers of Americans will lose medical coverage.

Increased cap on Salt tax

The bill increases the deduction limit for state and local taxes (Salt), a hugely important issue for a few Republican holdouts in some Democrat-controlled urban areas.

There is currently a $10,000 cap on how much taxpayers can deduct from the amount they owe in federal taxes. That expires this year.

In the new bill, House Republicans have raised the Salt limit to $40,000 for married couples with incomes up to $500,000.

This, too, was a major point of contention.

A 2017 law passed under the last Trump administration held the cap at $10,000 and was designed to make room in the federal budget to allow for tax breaks elsewhere.

Senate Republicans are proposing permanently extending the cap at the current $10,000 limit.

Snap benefits

Reforms have also been added to the Supplemental Nutrition Assistance Program (Snap), the government programme used by over 40 million low-income Americans.

The new bill requires states to contribute more to the programme, which is also partially funded by the federal government.

It also adds work requirements for able-bodied Snap enrollees who do not have dependents.

No tax on overtime or tips and other elements

The House bill makes good on one of Trump's signature campaign promises - ending taxes on tips and overtime pay.

The plan would also allow Americans to deduct interest on car loans for US-made cars only.

The child tax credit is also set to increase to $2,500 from $2,000 through to 2028, exclusively for Americans with social security numbers.

Additionally, the bill proposes increasing the debt ceiling by $4tn (£2.9tn). Senate Republicans want this raised to $5tn. The debt ceiling is the limit on the amount of money the government can borrow to pay its bills.

Lifting the debt limit allows the government to pay for programmes already approved by Congress.

The Senate version includes a provision that would allow Americans to deduct tips and overtime from their taxes. However, they propose gradually phasing out those benefits based on annual income, starting at $150,000 for individuals and $300,000 for joint filers.

On child tax credits, the Senate proposes making them permanent but lowering the limit to $2,200 per child.

Clean energy tax cuts

One of the most notable divisions between House and Senate Republicans is the Senate's proposal for clean energy tax breaks.

Although both call for an end to the Biden-era federal clean energy tax credits, Senate Republicans suggest phasing them out more slowly.

For instance, the Senate has extended the runway for businesses that build wind and solar farms to still benefit from the tax credits.

Companies that begin construction this year could qualify for the full tax break. That drops to 60% if they begin construction in 2026 and 20% if they begin in 2027. The credit would disappear in 2028.

The House version of the bill sought to end the tax breaks for those companies almost immediately.

What happens next?

The Senate must agree on a final version of the bill before sending it to the floor for a vote.

Since it is likely to include some of the changes to the original House bill, it will return to the House for another vote where it will almost certainly run into more challenges.

Republicans in the House have already expressed their grievances.

Mike Lawler, a Republican congressman from New York, posted on social media that any Senate measure that kept the $10,000 SALT cap would be "DEAD ON ARRIVAL" in the House.

Representative Chip Roy from Texas said the Senate's proposal on clean energy was "not close to enough".

Trump has repeatedly urged the Senate to get on board.

Shortly after the bill passed the House, he wrote on social media: "It's time for our friends in the United States Senate to get to work, and send this Bill to my desk AS SOON AS POSSIBLE!"

Democrats, who have neither a majority in the House nor Senate, have criticised the bill, particularly on changes to Medicaid and food stamps.

House Minority Leader Hakeem Jeffries called it a "reckless, regressive and reprehensible GOP tax scam" and pledged to use the bill against Republicans in next year's midterm elections.