ReutersElon Musk has expressed disappointment over a sweeping domestic policy bill backed by President Donald Trump and passed by House Republicans last week. He warned that it could worsen the federal deficit and undermine efforts to improve government efficiency.
Dubbed the “One Big Beautiful Bill Act” by Trump, the legislation includes an extension of his hallmark 2017 tax cuts, stricter Medicaid work requirements, increased border security funding, and a proposed rollback of clean energy tax credits.
It now moves to the Senate, where its prospects remain uncertain.
“I was disappointed to see the massive spending bill, frankly, which increases the budget deficit, not just decreases it, and undermines the work that the DOGE team is doing,” Musk told CBS Sunday Morning in an interview airing June 1. He was referring to the Department of Government Efficiency (DOGE), which the billionaire recently stepped back from.
Musk’s comments also highlight a broader philosophical split. As the former head of the DOGE, Musk once led a sweeping push to trim federal spending. The current bill’s deficit-heavy profile contradicts DOGE’s original mission.
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“I think a bill can be big or it can be beautiful,” he added. “But I don't know if it can be both. My personal opinion.”
According to the Congressional Budget Office, the legislation would add $3.8 trillion to the federal deficit by 2034, an outcome at odds with Musk’s stated goal of improving fiscal discipline in Washington.
Tesla could suffer from clean energy cuts
Although Musk did not mention Tesla directly, the proposed rollback of clean energy tax credits has raised concerns for the company. Tesla and other clean technology firms currently benefit from incentives that reduce the cost of electric vehicles (EVs) and solar installations for consumers.
According to a Bloomberg report, under the Inflation Reduction Act, EV buyers are eligible for up to $7,500 in tax credits. Solar systems qualify for a 30% investment tax credit. Reducing or eliminating these incentives could affect both pricing and consumer demand across the clean energy sector.
Tesla, General Motors, and other EV manufacturers, as well as their customers, could be among the hardest hit. Former President Biden’s climate law expanded the $7,500 credit to include new, used, and commercial EVs.
As per the report, the Republican plan would scale back or repeal the consumer EV credit by the end of 2025. Beginning in 2026, only manufacturers that have sold fewer than 200,000 EVs by the end of this year would remain eligible. Tesla and GM have already surpassed that threshold. The bill would also eliminate credits for used and commercial EVs. Congressional estimates suggest the total rollback would save the government more than $190 billion over the next decade.
These changes could reduce demand for Tesla’s popular models such as the Model Y and Cybertruck. They may also weaken the appeal of EVs more broadly. Tesla’s volume-led growth strategy could suffer, along with its competitive edge, especially as traditional carmakers and Chinese rivals continue to benefit from local incentives.
Musk has not yet publicly addressed how these proposed changes could impact Tesla’s business.
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Solar incentives also at risk
The bill also targets clean energy tax breaks that support Tesla’s solar and energy storage divisions, along with the wider green technology sector.
Bloomberg reported that homeowners would no longer be eligible for a 30% tax credit on solar panel installations and other clean energy systems after this year. This change would be a setback for consumers planning to invest in sustainable energy solutions.
The rollback would affect not only Tesla’s products like the Powerwall and Megapack, but also companies such as Enphase Energy and SolarEdge Technologies. The measure is expected to save the government $77 billion over a ten-year period, as per the report.
Musk’s remarks also point to growing distance between him and Trump, despite their earlier cooperation. The bill faces significant opposition in the Senate, where its final form remains uncertain.
“We are so far away from an acceptable bill, it’s hard to say,” said Senator Ron Johnson of Wisconsin, according to Bloomberg.
Dubbed the “One Big Beautiful Bill Act” by Trump, the legislation includes an extension of his hallmark 2017 tax cuts, stricter Medicaid work requirements, increased border security funding, and a proposed rollback of clean energy tax credits.
It now moves to the Senate, where its prospects remain uncertain.
“I was disappointed to see the massive spending bill, frankly, which increases the budget deficit, not just decreases it, and undermines the work that the DOGE team is doing,” Musk told CBS Sunday Morning in an interview airing June 1. He was referring to the Department of Government Efficiency (DOGE), which the billionaire recently stepped back from.
Musk’s comments also highlight a broader philosophical split. As the former head of the DOGE, Musk once led a sweeping push to trim federal spending. The current bill’s deficit-heavy profile contradicts DOGE’s original mission.
Also Read: Trump's campaign against law firms dealt another setback as judge blocks executive order
“I think a bill can be big or it can be beautiful,” he added. “But I don't know if it can be both. My personal opinion.”
According to the Congressional Budget Office, the legislation would add $3.8 trillion to the federal deficit by 2034, an outcome at odds with Musk’s stated goal of improving fiscal discipline in Washington.
Tesla could suffer from clean energy cuts
Although Musk did not mention Tesla directly, the proposed rollback of clean energy tax credits has raised concerns for the company. Tesla and other clean technology firms currently benefit from incentives that reduce the cost of electric vehicles (EVs) and solar installations for consumers.
According to a Bloomberg report, under the Inflation Reduction Act, EV buyers are eligible for up to $7,500 in tax credits. Solar systems qualify for a 30% investment tax credit. Reducing or eliminating these incentives could affect both pricing and consumer demand across the clean energy sector.
Tesla, General Motors, and other EV manufacturers, as well as their customers, could be among the hardest hit. Former President Biden’s climate law expanded the $7,500 credit to include new, used, and commercial EVs.
As per the report, the Republican plan would scale back or repeal the consumer EV credit by the end of 2025. Beginning in 2026, only manufacturers that have sold fewer than 200,000 EVs by the end of this year would remain eligible. Tesla and GM have already surpassed that threshold. The bill would also eliminate credits for used and commercial EVs. Congressional estimates suggest the total rollback would save the government more than $190 billion over the next decade.
These changes could reduce demand for Tesla’s popular models such as the Model Y and Cybertruck. They may also weaken the appeal of EVs more broadly. Tesla’s volume-led growth strategy could suffer, along with its competitive edge, especially as traditional carmakers and Chinese rivals continue to benefit from local incentives.
Musk has not yet publicly addressed how these proposed changes could impact Tesla’s business.
Also Read: Trump offers Canada free entry into $175 billion 'Golden Dome' defence plan—But only as 51st state
Solar incentives also at risk
The bill also targets clean energy tax breaks that support Tesla’s solar and energy storage divisions, along with the wider green technology sector.
Bloomberg reported that homeowners would no longer be eligible for a 30% tax credit on solar panel installations and other clean energy systems after this year. This change would be a setback for consumers planning to invest in sustainable energy solutions.
The rollback would affect not only Tesla’s products like the Powerwall and Megapack, but also companies such as Enphase Energy and SolarEdge Technologies. The measure is expected to save the government $77 billion over a ten-year period, as per the report.
Musk’s remarks also point to growing distance between him and Trump, despite their earlier cooperation. The bill faces significant opposition in the Senate, where its final form remains uncertain.
“We are so far away from an acceptable bill, it’s hard to say,” said Senator Ron Johnson of Wisconsin, according to Bloomberg.
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