Winners and losers as Trump’s Big, Beautiful Bill passes Congress hurdle

Who are better off with the Bill being passed?

Corporate America

Major business groups such as the US Chamber of Commerce and the Business Roundtable applauded the bill’s passage, citing provisions that will permanently extend key elements of the 2017 Tax Cuts and Jobs Act.

The legislation reinstates the ability for companies to fully deduct equipment purchases in the first year — a break that had been phasing out since 2023. It also restores immediate expensing of research and development costs, which businesses had been required to amortize over five years beginning in 2022.

Manufacturers

Manufacturers will benefit from new rules allowing full and immediate expensing for the construction of new facilities. The provision, retroactive to January 19, 2025, is set to last through the end of 2028.

The bill also enhances tax credits for semiconductor companies building fabrication plants in the United States, aiming to boost domestic chip production.

Speaker Mike Johnson gavels in the House chamber during final passage of President Donald Trump’s signature bill of tax breaks and spending cuts, at the Capitol on Thursday. (Photo: AP)

Small businesses and partnerships

Owners of certain pass-through entities, such as law firms, medical practices and investment partnerships, will continue to benefit from a tax deduction that allows them to write off a portion of their income on personal tax returns.

The deduction, originally set at 20 per cent, was increased to 23 per cent in the House version of the bill. The Senate maintained the original 20 per cent.

High-income Americans

An analysis by CNN showed that the top 20 per cent of earners would see their after-tax income rise by nearly $13,000 annually, according to the Penn Wharton Budget Model, translating to a 3 per cent increase.

For the top 0.1 per cent, the average gain is estimated at more than $290,000 per year. The bill also temporarily raises the cap on state and local tax (SALT) deductions to $40,000 annually for households earning up to $500,000, offering relief to residents of high-tax states.

A new provision bars millionaires from collecting unemployment benefits.

Tipped and overtime workers

Employees in tipped occupations will be allowed to deduct up to $25,000 in tip income from federal taxes through 2028. Workers who earn overtime can deduct up to $12,500 of that income. However, these benefits are subject to income limits.

Who will be hit by the bill?

Low-income Americans

The bill enacts sweeping changes to Medicaid and food stamps, imposing federal work requirements on both programs. For the first time in its 60-year history, Medicaid will require able-bodied adults, including parents of children as young as 14, to work, volunteer, or participate in job training to retain benefits.

The Congressional Budget Office estimates millions could lose coverage or assistance. Few of those removed from Medicaid rolls are expected to have access to employer-based insurance.

According to Penn Wharton, those earning under $18,000 annually would see their after-tax, after-transfer income fall by $165, or 1.1 per cent. Those earning between $18,000 and $53,000 would see a $30 gain, or 0.1 per cent increase. Middle-income households, earning $53,000–$96,000, would gain about $1,430, or 1.8 per cent.

The Senate bill also tightens verification for Affordable Care Act subsidies, potentially affecting middle-income Americans who rely on those federal supports. Overall, more than 10 million people could be uninsured by 2034, according to an analysis of the legislation and CBO projections cited by CNN.

Speaker Mike Johnson holds up a vote count alongside fellow Republicans after signing President Donald Trump’s signature bill. (Photo: AP)

Hospitals

Hospitals, particularly those serving Medicaid populations, warn that the bill’s changes will lead to increased uncompensated care and reduced access.

“This nearly $1 trillion in Medicaid cuts will result in irreparable harm,” Rick Pollack, the chief executive of the American Hospital Association, told CNN. While the bill includes a $50 billion rural hospital support fund, the association says it is insufficient to offset the losses.

Clean energy and EVs

Although the Senate removed an excise tax on wind and solar that advocates called a potential “killer,” the bill still phases out renewable energy tax incentives by 2027. It also imposes new requirements that critics say will make remaining credits harder to claim.

The American Clean Power Association called the bill a “step backward” that would cost jobs and raise electricity rates.

The measure also ends electric vehicle tax credits of up to $7,500 after September. Those incentives were originally scheduled to run through 2032.

Deficit hawks

The bill is projected to increase the federal deficit by $3.4 trillion over the next decade, according to CBO. That comes in addition to the existing $36.2 trillion national debt.

Higher deficits are expected to push up interest rates, increasing the cost of mortgages, car loans and business borrowing. The federal government’s own interest payments are projected to exceed $1 trillion per year which is already more than triple what they were in 2017 and larger than the entire defence budget.

(With inputs from CNN and Reuters)

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