Republicans Propose No Regulation of AI for the Next 10 Years

House Republicans added a new provision to their sweeping budget bill that would block states from regulating artificial intelligence for the next decade—a move that could upend hundreds of state-level AI laws and reshape the national debate over tech oversight.

"Through investments to modernize the Department of Commerce, we can integrate AI systems to make the Department more secure and effective," Representative Brett Guthrie, the chair of the Committee on Energy and Commerce, which introduced the provision, said on Tuesday. "To protect the integrity of this project, we are implementing guardrails that protect against state level AI laws that could jeopardize our technological leadership."

If enacted, the measure would halt both existing and future state restrictions on a wide class of AI and automated decision-making systems, while also encouraging "legacy business systems" to adopt new AI-related technology.

Why It Matters

The decade-long moratorium on state-level AI regulation would mark the most significant federal intervention in tech oversight since the early days of the internet.

As AI becomes increasingly central to daily life and business, the outcome of this legislative effort stands to influence innovation, industry accountability and consumer protection across the U.S.

What To Know

Guthrie, a Republican from Kentucky, inserted the 10-year moratorium into the House budget bill in a section focused on "Artificial Intelligence and Information Technology Modernization."

The provision would appropriate $500 million to the Department of Commerce to modernize and secure federal IT systems using commercial AI, automation technologies and the replacement of antiquated business systems. The funds are intended to support AI-driven improvements to operational efficiency, cybersecurity and service delivery throughout federal agencies.

Subsection (c) of the proposal would prevent any state or political subdivision from enforcing AI-related laws or regulations for 10 years after the bill's enactment. This would affect a wide range of automated decision systems, including those influencing or replacing human judgment in sectors such as health, criminal justice and online content moderation. More than 500 bills concerning AI safety, consumer protections or algorithmic bias that advanced in state legislatures this year could be sidelined if the moratorium becomes law, the Verge reported.

Tech companies—including OpenAI, Meta and Alphabet—have long argued against a "patchwork" of inconsistent state regulations that they say would hamper innovation and investment. In the past, tech interests lobbied successfully for California Governor Gavin Newsom to veto a sweeping state AI safety law.

Republicans are not unanimously supporting the approach. Senator Josh Hawley of Missouri raised concerns with Business Insider over eliminating states' ability to experiment with regulatory policies, arguing that federalism requires states to play a role. Senator Ted Cruz of Texas, however, backed the moratorium, comparing it to the internet tax moratorium of the 1990s. Cruz told Business Insider that the U.S. should take a "light touch regulatory approach."

Democratic lawmakers warn that this shift could disregard consumer privacy and allow unchecked AI misuse. Representative Jan Schakowsky of Illinois said the proposal might neglect vital protections, while Senator Ed Markey of Massachusetts warned in a post on X, formerly Twitter, of adverse effects on marginalized communities and environmental policies.

What People Are Saying

Senator Ted Cruz, a Republican from Texas, told Business Insider: "I don't know whether that provision will survive on reconciliation, but as a substantive matter, it's a policy I support."

Representative Jay Obernolte, a Republican from California and a member of the Energy Committee, said during Tuesday's markup session: "No one is suggesting that AI should be unregulated. … But the appropriate body for doing that regulation is the U.S. Congress."

Representative Kathy Castor, a Democrat from Florida, said in the session: "[This measure] is a shocking surprise addition to the billionaire tax giveaway."

Representative Jan Schakowsky, a Democrat from Illinois, said in a news release on Monday: "The Republicans' 10-year ban on the enforcement of state laws protecting consumers from potential dangers of new artificial intelligence systems gives Big Tech free rein to take advantage of children and families. It is a giant gift to Big Tech and once again shows that Republicans care more about profits than people."

What Happens Next

The provision is set to advance with the House budget package to the Senate, where it is expected to undergo parliamentary scrutiny to determine if it meets reconciliation requirements. The final outcome may hinge on Senate approval and potential legal challenges from states with existing AI laws.