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Trump Rejects Extending Obamacare Tax Credits, Escalating Battle Over Rising Premium Costs

Banking and Insurance

Trump Blocks Obamacare Tax Credit Extension

Business Honor
26 November, 2025

President signals he prefers ACA subsidies to expire, deepening Republican divisions on health policy.

President Donald Trump signaled on Tuesday that he would “rather not” extend the expiring Obamacare tax credits, a move that could lead to significant premium increases for millions of Americans next year. Speaking to reporters aboard Air Force One, Trump rejected suggestions that he was considering a two-year extension of the subsidies tied to the Affordable Care Act, insisting instead that he prefers to let them lapse at the end of December.

The subsidies, first expanded in 2021 to keep premiums capped, are set to expire just as an estimated 22 million people could face higher costs. The debate over the Affordable Care Act tax credits has widened divisions inside the Republican Party, with conservative lawmakers pushing to end the enhanced funding and moderates urging a temporary extension while Congress works toward a broader overhaul of U.S. healthcare policy.

Despite GOP control of the White House and both chambers of Congress, any major health care legislation will still require Democratic votes to clear the Senate’s 60-vote threshold. Trump said that while he prefers to end the subsidies altogether, “some kind of extension may be necessary” as part of a larger negotiation. He also claimed that some Democrats are privately engaging with the White House, though he declined to name them.

Trump reiterated his preference to redirect the funds entirely, arguing that money should go “to the people directly” rather than to insurance companies. He suggested that individuals could then purchase their own plans—though he did not outline how such a proposal would function. As the debate continues, the Obamacare tax credits news is shaping up to be a defining fight of the coming legislative session, with both parties bracing for the political and economic fallout.