On June 28, 2025, Senate Republicans, working in close collaboration with former President Donald Trump, introduced a sweeping tax and immigration bill—one of the most consequential legislative proposals to emerge in this election year. The bill, officially titled the American Prosperity and Security Act, aims to deliver substantial changes to the U.S. tax code while implementing more stringent immigration controls.
Key Tax Provisions
- Extension of 2017 Tax Cuts: The bill seeks to make permanent several individual and corporate tax cuts originally set to expire in 2025, including lower income tax brackets and the 21% corporate tax rate.
- Expansion of Child Tax Credit: The legislation proposes an increase in the Child Tax Credit, raising the maximum benefit to $2,500 per child, but adds more stringent work requirements.
- Capital Gains and Estate Tax Adjustments: The bill reduces the top capital gains tax rate from 20% to 15% and raises the estate tax exemption to $15 million per individual.
- Small Business Deductions: The Qualified Business Income (QBI) deduction for pass-through entities is extended and enhanced, with a higher income threshold before phase-out.
Major Immigration Measures
- Border Security Funding: The bill allocates $15 billion for border enforcement, including the completion of physical barriers along the southern border and increased technology for surveillance.
- Asylum and Parole Restrictions: It tightens asylum eligibility, raising the burden of proof for applicants and limiting parole authority for migrants at the border.
- Mandatory E-Verify: The legislation would require all U.S. employers to implement E-Verify to confirm the legal status of new hires, phased in over two years.
- Visa Program Changes: The bill caps annual humanitarian parole and limits family-based immigration sponsorship, while expanding employment-based visas for STEM graduates.
Political and Economic Implications
The bill has quickly become a flashpoint in Congress, with Democrats criticizing both the tax cuts for high-income earners and the stricter immigration policies. Senate Majority Leader Mitch McConnell emphasized the bill’s focus on economic growth and national security, while Democrats have vowed to oppose provisions they say harm working families and immigrants.
Economic analysts project that the tax measures could increase the federal deficit by over $1.5 trillion over the next decade, while immigration advocates warn of humanitarian impacts at the border. Business groups have expressed support for the QBI extension and STEM visa expansion but remain divided over mandatory E-Verify.
The American Prosperity and Security Act now heads to the Senate floor for debate, with a vote expected before the July 4 recess. Its fate may hinge on negotiations with moderate senators, as the bill faces an uncertain path in the Democratic-controlled House.
