The 1,500-page bill included more than $110bn (£88bn) in emergency disaster relief and $30bn (£23bn) in aid to farmers. It also included the first pay raise for lawmakers since 2009, federal funds to rebuild a bridge that collapsed in Baltimore, healthcare reforms, and provisions aimed at preventing hotels and live event venues from deceptive advertising.
White House Press Secretary Karine Jean-Pierre issued a statement after Trump came out against the bill, saying: "Republicans need to stop playing politics with this bipartisan agreement or they will hurt hardworking Americans and create instability across the country."
"Triggering a damaging government shutdown would hurt families," President Joe Biden's spokeswoman continued, adding: "A deal is a deal. Republicans should keep their word."
When asked by CNN on Wednesday night whether the existed deal had officially been scrapped, Congressman Scalise said: "Yes".
He added that "there is no new agreement right now" and that "there's still a lot of negotiations and conversations going on".
It is not clear how Republican House Speaker Mike Johnson plans to proceed.
Mr Musk, who Trump has tasked with cutting government spending in his future administration, lobbied heavily against the existing deal.
On Wednesday night, Mr Musk posted on X: "Your elected representatives have heard you and now the terrible bill is dead. The voice of the people has triumphed."
There have been 21 US government shutdowns or partial shutdowns over the past five decades - the longest of which was during Trump's first term when the government was shuttered for 35 days.