CBO analyzed the final version of the act after a series of amendments introduced by Republicans just before voting in the Senate. The act was adopted by a minimum advantage of votes – 51 to 50 in the Senate and 218 to 214 in the House of Representatives. President Trump signed it on July 4.
The new law extends tax cuts from 2017, introduces tax breaks for tips and overtime for the next four years, and provides hundreds of billion dollars. additional expenses for the army and implementation of the mass deportation program. Some of these costs will be covered by reducing expenditure on Medicaid, SNAP benefits and financing of pure energy.
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Republicans with low support
CBO analysis has shown that although the Act provides for cutting net expenditure of $ 1.1 trillion, the reduction of budget revenues will reach up to $ 4.5 trillion. Compared to the situation if the new law did not come into force. This means that the budget deficit will increase significantly.
Republican leaders argue that the adoption of the Act was necessary to avoid tax increases that would threaten Americans at the end of the year, when the key elements of tax reform of 2017 would expire. In turn, democrats criticize the new law, claiming that it brings the greatest benefits at the richest, and is financed at the expense of the working class.
In recent polls, the law enjoys little social support. Representatives of the Democratic Party emphasize that the cuts in social programs will be most affected by low -income people.
CBO has announced that the Act also introduces modifications in Affordable Care Act (ACA), which are to result in a reduction in average contributions to the standard ACA plan by about 0.6 percent. In 2034, however, the minority leader in the Senate Chuck Schumer warned that the actual number of people losing insurance may be even higher if the ACA financing, which expires this year.
Schumer estimated that the law is “the ultimate betrayal of the American nation”, and its effects will be felt by voters, when bills increase, dismissals appear and more people will lose access to healthcare.
Some of the Republicans and allies of Trump's administration present the act as favorable for “working families”, paying attention to tax breaks on tips and overtime. Marshal of the Chamber of Representatives Mike Johnson argued that voters would appreciate these changes during the next elections to the Congress. Johnson emphasized that the law was prepared for Americans from the middle and lower class who have to feel its positive effects in the form of higher earnings, greater possibilities and economic growth. He also added that he is not afraid of negative political consequences for the Republican Party in the upcoming elections, even anticipating that the group will gain additional fines.
