The Congressional Budget Office (CBO) has released a report showing that President Donald Trump’s tax and spending law will largely benefit the wealthiest Americans, while leaving the poorest with less. The CBO estimates that the bottom 10% of income earners will lose about $1,200 annually, while the top 10% will see their income rise by $13,600 due to tax cuts.
Impact on the Poorest Americans
The CBO’s analysis highlights that the poorest 10% of Americans will experience a reduction in income, primarily due to new restrictions on government programs like Medicaid and food assistance. Additionally, about 2.4 million people are expected to lose eligibility for the Supplemental Nutrition Assistance Program (SNAP) because of new work requirements under the law. These cuts will significantly impact low-income households, reducing their financial stability.
Benefits for the Wealthiest
While many Americans will see some increase in income from the tax cuts, the wealthiest households will benefit the most. The CBO’s report estimates that the richest 10% of earners will see an increase of $13,600 in their annual income, reflecting the focus of the tax cuts on high-income individuals and corporations.
Concerns About Medicaid and Health Insurance
One of the major provisions of the law is changes to Medicaid, which could result in more than 10 million Americans losing their health insurance by 2034. These cuts to healthcare, along with reductions in food aid, are part of a broader trend of government austerity that critics argue disproportionately affects the poor.
Political Reactions and Criticism
Republican lawmakers, including Rep. Jason Smith, have dismissed the CBO’s findings, calling the agency’s estimates inaccurate and biased. Meanwhile, Democratic leaders, including Rep. Brendan Boyle, have condemned the law, arguing that it serves the interests of billionaires while leaving working-class Americans worse off. In town hall meetings, many constituents have voiced their discontent with the bill, calling for higher taxes on the wealthy to address inequality.
Republicans Defend the Bill
Despite the criticism, Republicans continue to defend the legislation, arguing that the tax cuts will spur economic growth and benefit all Americans in the long run. President Trump has remained steadfast in promoting the law, dubbing it the “One Big Beautiful Bill” that will boost the economy and secure borders.