New projection signals good news for families, workers in Trump's 'big, beautiful bill'
FIRST ON FOX: A key U.S. economic agency is projecting that President Donald Trump's tax policy in his "one big, beautiful bill" will lead to increased take-home pay for American families and higher wages for U.S. workers.
The Council of Economic Advisers (CEA), which advises the White House on economic policy, released a report on Monday morning that said, "Taken as a whole, the CEA estimates that the tax cuts in the President's proposals and the One Big Beautiful Bill will substantially boost investment and GDP relative to if expiring provisions from the [Tax Cuts and Jobs Act] are not extended."
Congressional Republicans are working to permanently extend Trump's 2017 Tax Cuts and Jobs Act (TCJA), as well as implement a list of new, shorter-term Trump tax policies, like eliminating penalties on tipped and overtime wages, while granting seniors an added tax deduction.
Republican leaders have warned that failure to extend TCJA could lead to a tax increase of up to 22% for millions of families.
But extending them could lead to more money in people's pockets in the long run, the CEA said.
"For workers and families, the CEA forecasts that wages will be about $6,100 to $11,600 higher, with family take-home pay $7,800 to $13,300 higher because of the increase in wages and reduction in tax obligations," the new analysis said.
The CEA said the added deduction for seniors, meanwhile, would increase the average take-home pay for qualifying seniors by approximately $400 to $450 per year.
If passed, the policies would also boost U.S. investment in the long run from 4.9% to 7.5%, according to the projection, and could save or create as many as 4.2 million full-time equivalent (FTE) jobs in the long run.
It also estimated that Trump's "no tax on tips" proposal alone would increase tipped workers' pay by an average $1,675 per year, while eliminating the tax on overtime wages "will cause overtime workers to increase their overtime hours by 4.7 percent, leading to a 0.2 percent increase in aggregate labor supply while the provision is in effect."
"As a result, the level of GDP increases by 0.1 to 0.2 percent in the short run. The average overtime worker receives a tax cut of between $1,400 and $1,750 per year," the projection said.
White House press secretary Karoline Leavitt said during a Monday morning briefing, "This bill will give Americans the largest tax cuts in our nation's history. When Republicans pass the bill, Americans will be keeping more of their hard-earned money and taking home much bigger paychecks."
"If Democrats get their way and the Trump tax cuts are not extended, Americans will face the largest tax hike in history to the tune of $4 trillion. Republicans must not side with Democrats in helping them raise taxes," Leavitt said.
It comes as Democrats accuse Republicans of trying to gut critical programs like Medicaid and Social Security to secure tax increases for wealthy Americans.
They've pointed to projections like those by the Joint Committee on Taxation, which said people making less than $50,000 per year would get $263 in tax relief, and those making over $1 million would get more than $81,000.
But Republicans have argued they are focused on aiding the working and middle classes with Trump's tax bill – while not raising taxes on any Americans.
Rep. Mike Haridopolos, R-Fla., also pointed out last week that Republicans' bill does not touch the top income tax bracket.
"I kept hearing this idea that we're cutting taxes on the rich," Haridopolos said, referring to conversations by his Democratic colleagues on the House floor last week.
"The current rate is 37%. Under our new proposed bill, it's still 37%. We're keeping that rate static, we're not cutting taxes for the rich. What we need to do, of course, is invest in the people again – the best way you do that is offer tax relief."
Republicans are working to pass Trump's policies on tax, immigration, energy, defense, and the national debt all in one massive bill via the budget reconciliation process.
Budget reconciliation lowers the Senate's threshold for passage from 60 votes to 51, thereby allowing the party in power to skirt the minority – in this case, Democrats – to pass sweeping pieces of legislation, provided they deal with the federal budget, taxation, or the national debt.
House Republicans are hoping to advance Trump's bill through the House by the end of this week, with a goal of a final bill on the president's desk by Fourth of July.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
New York Times
32 minutes ago
- New York Times
Here Are Some of the Southern California Immigration Raids From the Past Week
Tension has been growing for months over the Trump administration's aggressive efforts to deport people who remain in the United States illegally. But the situation escalated in Los Angeles about a week ago. After protesters converged on immigration raids and demonstrated against U.S. Immigrations and Customs Enforcement officials, President Trump deployed 2,000 California National Guard troops to the city. While the focus has turned to ensuing protests in downtown Los Angeles and the heavy military response — the call-up has since increased to 4,000 National Guard members and 700 Marines — ICE agents have continued immigration raids each day in Southern California. It is difficult to have a comprehensive picture of the ICE efforts because the agency does not issue a list of people who have been detained each day nor the locations where they were taken from, and authorities did not confirm the number of raids they conducted in California this week. But residents, immigrant rights groups and elected leaders have cobbled together accounts of ICE workplace raids that they describe as indiscriminate attempts to find anyone who might be undocumented. Want all of The Times? Subscribe.
CBS News
33 minutes ago
- CBS News
Bay Area high school graduate accepted to 24 colleges, including some of the best in the country
As we celebrate our Bay Area high school graduates, a Vista Oaks Charter School high school graduate was accepted to 24 colleges and universities and was awarded $1 million worth of scholarships. Keion Rothschild has achieved what many of us can only dream of. He got accepted into some of the best universities in the country, including UC Berkeley, UCLA and USC. Rothschild still can't believe it. "Wow, I'm really able to do that," Rothschild said. "It really puts it into perspective what you can do when you put your mind to it." Rothschild gave a speech at his high school graduation ceremony, encouraging his peers to make a positive impact on our world. "I just want to remind you all that you are powerful, you are resilient, you are capable of achieving incredible things," Rothschild said. "Let's go into this world with our heads held high. Let's make a difference and honor the legacy of those who came before us." Graduating with a 4.0 GPA with honors, Rothschild was awarded $1 million worth of scholarships from colleges and universities across the country. "Like I said, 'It's all in God's plan,'" said Rothschild to his mom. "I'm ecstatic for my son and I say this so often; I am just blessed to be his mom," Onó Rothschild said. Rothschild is a role model to his six siblings and a leader in his school and community. He's an ambassador for the youth empowerment nonprofit Youth Utilizing Power and Praise based in Santa Clara County. "When he first started with his coach in public speaking, which at that time was my husband, Theophilus Booker, Keion was so shy," said Shelene Huey-Booker, YUPP founder and executive director. "He's probably gonna get mad that I say this, but I'm gonna say it anyway, cause that's what aunties do. He would just cry. It was just too much for him to now seeing him speaking at his graduation. It's just phenomenal and it's such a blessing to be able to witness it." "A lot of people feel like they're alone and I had my own experience with that," Rothschild said. "But when you see that played out in front of you and you know how many people are actually there for you. It changes your whole perspective on everything." With the big decision of choosing from 24 colleges and universities, Rothschild eventually chose the University of Oregon, which awarded him a full-ride scholarship in their honors program. Now, Rothschild is looking to the future. "My next step is getting into college and graduating and then I want to earn a whole bunch of money and buy my family anything they want," said Rothschild. "I want to buy my mom a house, a big, beautiful mansion. Everything she wants. My auntie, you guys met earlier. I want to buy her a house, my grandma a house. Just buy everybody a house really." Rothschild's strength, resilience and humility are qualities that will carry him through life. "I wouldn't say it's about me per se," said Rothschild. "I think it's all the grace of God." No matter what lies ahead, his future is bright. Rothschild plans to major in English and become a screenwriter.
Yahoo
38 minutes ago
- Yahoo
How Trump's Africa strategy may become a double-edged sword
With US President Donald Trump on a cost-cutting warpath since starting his second term, aid to Africa has been slashed and now defence spending is in his sights - but could these approaches cost more in the long run? The phrase his administration presses on Europe to assume more of the costs of its own defence is "burden sharing". This is the challenge that Washington is now throwing down to African armies too - and they are far less comfortably resourced to take it on. Moreover, having paid dearly in lives and money, in the struggle to hold back the spreading reach of jihadist armed groups across the Sahel, the Lake Chad basin and Somalia over recent years, they could be forgiven for feeling that they already carry much of the burden - and for the sake not just of their own continent but the wider international community too. Benin, which has lost more than 80 soldiers in jihadist attacks since the start of the year, is just one example. "The epicentre of terrorism on the globe" is how the Sahel was described a few days ago by Gen Michael Langley, who as head of US Africa Command (Africom) oversees the American military presence south of the Sahara. In briefings and interviews over the past few weeks, he has graphically outlined the threat that jihadist groups will present if their push southward towards the Gulf of Guinea succeeds. "One of the terrorists' new objectives is gaining access to West African coasts. If they secure access to the coastline, they can finance their operations through smuggling, human trafficking and arms trading. This not only puts African nations at risk but also raises the chance of threats reaching US shores." Gen Langley has admitted that the current upsurge in militant attacks is "deeply concerning". Yet he has also repeatedly hammered home a core message: the US is minded to rein back its own sub-Saharan military operations, leaving local armies to take on more of the defence burden. Some 6,500 personnel are currently deployed in Africa by the US military and a 2019 list published by Africom mentioned 13 "enduring" American bases across the continent and a further 17 more temporary facilities. But some of these installations, including the purpose-built drone base at Agadez in Niger, have already been shut down, in particular after military juntas seized power in Niger, Mali and Burkina Faso since 2020. And it now looks as if the once-ambitious American operational footprint will be pruned back quite a lot more. Perhaps we will see more air power deployed from offshore to hit militant targets - Gen Langley says there have been 25 strikes in Somalia this year, double the 2024 total - but a much thinner permanent on-the-ground military presence. "Some things that we used to do, we may not do anymore," he recently told a conference in Kenya's capital, Nairobi, that brought together chiefs of defence staff and other senior officers from 37 countries. "Our aim is not to serve as a permanent crutch, but to achieve US security objectives that overlap with our partners. We should be able to help African nations build the self-reliance they need to independently confront terrorism and insurgencies." In the bluntness of his language Gen Langley reflects the stark change of outlook and policy that has come from January's change of power at the White House. "We have set our priorities now - protecting the homeland." What matters to the no-longer-so-new Trump II administration, the general made clear in a Pentagon publication last week, is fighting terrorists - particularly those who might attack the US. Other priorities are countering the spread of Chinese military influence across Africa and protecting freedom of maritime navigation through key trade choke points such as the Strait of Gibraltar and the Mediterranean, the Suez Canal and the Bab el-Mandab Strait at the southern end of the Red Sea. In some respects, the focus on training and capacity building that Gen Langley now expounds is not so very different from the approach of previous American administrations, Republican as well as Democrat. He lauds the National Guard State Partnership Program, through which individual US states have been helping to build the capacity of government security forces across Africa and other parts of the world - for the past three decades. France too is pursuing this approach, with the closure of bases in Chad and Senegal, while those in Ivory Coast and Gabon have been handed over to their governments, with only small French training teams left behind to work alongside African colleagues. However, in other respects, the Trump administration's Africa strategy represents a drastic shrinkage in outlook and - critics might argue - a conscious retreat from addressing the factors that drive instability, conflict and terrorism, particularly in the Sahel, which is among the poorest regions on the planet. For under President Joe Biden the US looked far beyond the military realm alone in its efforts to counter the both the growing reach of jihadist groups and other sources of violence. And Gen Langley, as Africom chief, was an articulate exponent of this much broader thinking. Only last year, in an interview with the Associated Press news agency, he outlined what he described as a "whole of government" response to the proliferation of conflict, stressing the importance of good governance and action to tackle the fragilities of African states and the impacts of desertification, crop failure and environmental change. This approach openly recognised that recruitment by armed groups and the spread of violence is fuelled not only by jihadist ideology, but also by a host of social and economic factors, including the stresses now afflicting farming and pastoralist livelihoods. Gen Langley himself does not seem to have abandoned this analysis, recently noting how Ivory Coast had countered the jihadist threat to its northern border areas by complementing security force deployments with development projects. He could equally have pointed to the success of a similar approach pursued by the president of Niger, Mohamed Bazoum, before he was deposed in the July 2023 coup. But of course, these days Africom must operate within the context of a US foreign policy radically reshaped under Trump. There are even rumours that it could be downgraded to become a subsidiary of the US command in Europe and Gen Langley suggests African governments should tell Washington what they thought of this idea. Already the separate Africa unit at the radically slimmed down National Security Council at the White House is reportedly being wound up and integrated into the Middle East-North Africa section. Its director, Gen Jami Shawley, an Africa specialist appointed to the role only in March, has now been assigned to more general strategic functions. Addressing Congress this week, Gen Langley warned about China's and Russia's African ambitions: Beijing's agility at capitalising on the US's absence and Moscow's ability to seize military opportunities created by chaos and instability. Given these concerns, some might wonder if the general is discreetly signally his doubts about a slimmed down Africa strategy. Meanwhile, under the "efficiency drive" led, until recently, by tech billionaire Elon Musk, the American government's main international development agencies, USAID and the Millennium Challenge Corporation, have been effectively shut down. The spine of the new US economic engagement with Africa is now private sector trade and investment. But business generally needs to operate in a stable and secure context - which Africa's most fragile and violence-prone regions cannot offer. And in winding up the American development agencies, the Trump administration has stepped aside from funding the rural projects and social programmes that sought to address land and water pressures and lack of economic opportunity, the key drivers of conflict - and the jihadist groups' recruitment of frustrated rural young people. For the fragile regions that are the main sources of jihadist violence the US response is reduced to the purely military, and now it is seeking to shift even most of that on to the shoulders of African states that already struggle to respond adequately to a plethora of challenges and responsibilities. Paul Melly is a consulting fellow with the Africa Programme at Chatham House in London. The region with more 'terror deaths' than rest of world combined Freed captive tells BBC of life in West African jihadist base Why Trump is on the warpath in Somalia 'My wife fears sex, I fear death' - impacts of the USAID freeze Trump's tariffs could be death knell for US-Africa trade pact Go to for more news from the African continent. Follow us on Twitter @BBCAfrica, on Facebook at BBC Africa or on Instagram at bbcafrica Focus on Africa This Is Africa
