Policymakers in Washington are considering a multibillion-dollar tax break for private credit funds as part of President Donald Trump’s flagship spending plan, even as the bill would swell US debt and cut programmes such as indigent medical care.

The proposal would limit taxes on dividends paid to investors in so-called business development companies, one of the primary investment vehicles utilised by the private credit industry.

The terms were included in Trump’s “big, beautiful bill” that passed the US House of Representatives, Congress’ lower chamber, last month. It was left out of the Senate’s draft version, but could be added back in the coming days amid fierce lobbying over amendments to the final version, people familiar with the deliberations told the Financial Times.