Breaking down Trump's 'Big Beautiful Bill': Who gains, who loses and what it means for Americans

US President Donald Trump dances as he leaves the stage after speaking at the Salute to America Celebration at the Iowa State Fairgrounds in Des Moines on July 3, 2025. (Photo by ANDREW CABALLERO-REYNOLDS / AFP)

As fireworks and stealth bombers mark the signing of Donald Trump’s self-described “big, beautiful bill” this US Independence Day, the sweeping tax and spending package is poised to reshape America’s economic landscape.

With permanent corporate tax breaks, revived deductions, and deep cuts to safety net programs, the legislation has drawn sharp praise and stinging criticism in equal measure. Here's a breakdown of who stands to gain, and who could lose.

WINNERS

Corporate America: The new bill brings major tax relief for corporate America by making key parts of Trump’s 2017 tax cuts permanent. Companies can now continue to fully deduct the cost of new equipment and research expenses. Manufacturers also get a boost: they can write off the full cost of building new factories, retroactive to January 19, 2025, a move aimed at encouraging onshore production. Chipmakers stand to benefit as well, with expanded tax credits for those building semiconductor plants in the US, aligning with efforts to reduce reliance on China.

Small Businesses: The bill extends key tax benefits for small businesses and pass-through entities such as partnerships, including doctors, lawyers, and investors. They will continue to receive a 20 per cent income deduction, with the House version increasing it to 23 per cent. The National Federation of Independent Business praised the move, calling it a “lifeline” for small entrepreneurs struggling with rising costs.

High-income earners: High-income earners stand to gain significantly from the bill. The top 0.1 per cent could see annual income boosts of over $290,000, while households in the top 20 per cent may gain around $13,000 a year. The bill also raises the state and local tax (SALT) deduction cap to $40,000 for five years for households earning under $500,000, offering relief to taxpayers in high-tax states like New York and California.

Tipped and overtime workers: The bill offers targeted tax relief for frontline workers. Tipped employees can deduct up to $25,000 of their tips, and those earning overtime can deduct up to $12,500, through 2028. While income limits apply, this marks a rare benefit aimed directly at lower- and middle-income workers.

LOSERS

Low-income Americans: Low-income Americans are likely to be hit hard by the bill. It includes major cuts to Medicaid and SNAP, with new work requirements that could push millions off these programs. The Congressional Budget Office estimates over 10 million people may lose health coverage by 2034 due to stricter Medicaid and ACA subsidy rules. Overall, individuals earning under $18,000 a year could see their after-tax income drop by around $165, or 1.1 per cent.

Hospitals: Hospitals, particularly those serving low-income populations, are expected to bear the brunt of reduced Medicaid support. Even with a $50 billion rural hospital fund, the American Hospital Association warns of “irreparable harm.”

Clean energy and EV sectors: The bill deals a blow to the clean energy and electric vehicle sectors. Tax incentives for wind, solar, and other renewable sources will be phased out by 2027, with stricter eligibility rules taking effect even earlier. Additionally, the $7,500 tax credit for electric vehicles will end this September, five years earlier than planned, reducing support for cleaner transportation options.

Middle income and ACA Users: Middle-income Americans who rely on the Affordable Care Act could face challenges as tighter checks on premium subsidies may make insurance less affordable. While households earning between $53,000 and $96,000 are expected to see a small income increase of about $1,430 (or 1.8 per cent), it likely won’t be enough to cover rising healthcare and housing costs in many areas.

Deficit hawks and future taxpayers: The bill is expected to significantly increase the national debt, with the Congressional Budget Office projecting a $3.4 trillion addition to the deficit over the next decade. As a result, borrowing costs may rise even further. The U.S. is already spending over $1 trillion a year on interest payments – more than its entire defence budget – putting added pressure on future taxpayers.