Controversial US budget bill is now law; here’s what it means for tech

US President Donald Trump today signed what he called his “One Big Beautiful Bill” during Fourth of July celebrations at the White House, after it squeaked through the House of Representatives Thursday afternoon in a 218 – 214 vote.

But the bill was missing what had been one of its most contentious clauses, at least for the tech industry: a 10 year ban on AI regulation by individual states. The Senate almost unanimously voted to remove that section on Tuesday.

However, noted Scott Bickley, advisory fellow at Info-Tech Research Group, “H.R. 1 [the bill’s official designation] has many provisions that could fundamentally redefine the strategic environment for the enterprise.”

And despite the removal of the AI regulation ban, Bickley said, “it does signal that Washington is seriously considering a national AI framework. Tech leaders investing in genAI today should plan for a regulatory layer tomorrow, which will likely focus on explainability, auditability, and training data integrity.”

Permanent R&D and capital expensing provisions could turn the tax code into a “strategic lever,” he noted. “CIOs and CTOs now have a clear financial incentive to anchor AI training, cloud deployment, and cybersecurity tooling on US soil. For organizations with global architecture, this could reshape their location strategies around data, compute, and compliance.”

In addition, defense allocations for cyber-resilient supply chains, domestic manufacturing, and AI-adjacent technologies could give IT ”a rare but crucial chance to renegotiate vendor SLAs around security baselines,” he said.

On the minus side, he pointed out that loan caps for graduate programs and increased immigration fees could affect talent pipelines, especially for cybersecurity and AI, creating challenges for enterprises whose staffing needs are accelerating.

And while the Department of Energy got a $150 million appropriation to partner with industry sectors within the US to “curate the scientific data of the Department of Energy across the National Laboratory complex,” to make it usable by artificial intelligence and machine learning models, and to use the AI to develop microelectronics and new efficient energy technologies, the bill also slashed other energy spending and eliminated tax credits for environmental initiatives such as clean energy.

“Ultimately, it looks like H.R. 1 will reward localized innovation, incentivize tech-driven capital investment, and foreshadows a coming wave of AI oversight, all while seemingly leaving CIOs in the public sector and ESG-driven organizations to self-fund modernization efforts,” Bickley said.