• Elon Musk criticized President Trump’s tax bill, citing concerns about its impact on government spending and clean energy incentives, while also highlighting its $2.3 trillion increase to the budget deficit.
• The bill introduces tax cuts for individuals and corporations but includes $1 trillion in cuts to programs like Medicaid and Snap, drawing criticism for targeting low-income households.
• Despite Musk’s financial backing of Trump’s 2024 campaign, his disapproval of the bill signals a growing rift, as he warns of its potential to worsen economic inequalities.

Tesla CEO Elon Musk has publicly criticized President Donald Trump’s tax bill, arguing that the legislation undermines efforts to reduce government spending. The remarks, made during an interview with CBS’s Sunday Morning, highlight growing tensions between the billionaire and the U.S. president, despite Musk’s prior financial support for Trump’s campaign.

Spending Plan Sparks Controversy

The One Big Beautiful Bill Act, narrowly approved by the U.S. House of Representatives last week, introduces sweeping tax cuts for individuals and corporations while eliminating several clean energy incentives initiated under President Joe Biden. The bill also includes $1 trillion in cuts to programs like Medicaid and Snap food stamps, which assist low-income families. Despite these reductions, the Congressional Budget Office estimates the legislation will increase the budget deficit by $2.3 trillion.

In his interview, Musk expressed disappointment, stating, “I think a bill can be big, or it can be beautiful. But I don’t know if it can be both.” Musk’s comments underscore his concerns about the bill’s economic impact, particularly as it contradicts the cost-cutting initiatives he led earlier this year as head of the “Department of Government Efficiency” (Doge).

Musk’s Previous Role in Government Efficiency

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Since January, Musk had been tasked with overseeing efforts to streamline government spending, an initiative he referred to as essential for the country’s financial stability. However, Musk stepped back from this role in April after Tesla’s first-quarter earnings fell by 71%, with profits dropping to $409 million compared to $1.39 billion in the same period the previous year.

Tesla’s stock has also suffered amid these developments, losing approximately 25% of its market value since Musk joined the Trump administration. The loss of a $7,500 electric vehicle (EV) tax credit and the introduction of a $250 annual registration fee for EV owners under the new bill has raised additional concerns for Musk, who previously advocated for ending such incentives before Tesla’s profits began to decline.

Tax Bill’s Broader Implications

The bill fulfills several of President Trump’s campaign promises, including tax cuts and funding for a border wall with Mexico. It also allocates resources for mass deportations of undocumented immigrants. However, these measures have drawn criticism for targeting social safety nets, with $1 trillion in cuts impacting Medicaid and other benefits. Critics argue these cuts disproportionately affect struggling households.

Republican lawmakers remain divided over the bill. Senator Rand Paul from Kentucky described the proposed cuts as “wimpy and anemic,” warning that the bill could significantly increase the national debt. Meanwhile, some members of Trump’s base, including former White House strategist Steve Bannon, have cautioned that reducing programs like Medicaid might alienate key supporters.

Growing Rift Between Musk and Trump

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Musk’s recent criticism comes despite his financial backing of Trump’s 2024 presidential campaign. Musk’s super PAC, America PAC, donated $200 million to Trump’s campaign, a move widely credited with helping secure his return to the White House. However, Musk’s disapproval of the spending bill signals a potential rift in their relationship.

Musk’s concerns about government spending align with broader criticisms of the bill’s potential to exacerbate economic inequalities. As Tesla faces financial challenges and as political debates over the legislation continue, Musk’s remarks add weight to ongoing discussions about the future of fiscal policy in the United States.

Next Steps and Global Perspective

The Senate is expected to review the bill in the coming weeks, with hardline Republicans pushing for deeper spending cuts to address the national debt. International observers are closely monitoring the legislation’s implications for U.S. economic policy and its potential impact on global markets.

As debates continue, the legislation highlights the tension between fulfilling campaign promises and addressing long-term fiscal sustainability. Musk’s criticism may further fuel opposition to the bill among lawmakers and the public.

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