- President Trump’s “One Big Beautiful Bill” offers the largest middle-class tax cut in American history.
- All 50 states forecast long-run wage gains and after-tax income increases for families with two children.
- California families could gain up to $16,000 in take-home pay; Alabama households up to $10,800.
- Policy includes full business expensing, pass-through deductions, and reduced statutory rates.
- Forecasts are modeled by the Council of Economic Advisers (CEA), using techniques from the 2017 TCJA.
Lead
President Donald J. Trump’s administration has unveiled a sweeping state-by-state analysis showing projected economic benefits from his proposed “One Big Beautiful Bill,” a tax and spending reform package hailed by the White House as “the largest tax cut in history.” The Council of Economic Advisers (CEA) says the bill will raise wages, slash taxes, and significantly increase take-home pay for working and middle-class families across all 50 states.
Background
The legislation, a centerpiece of President Trump’s second-term economic agenda, is designed to supercharge investment and reward work through measures such as full expensing for businesses, reduced tax rates, and expanded deductions for pass-through entities. Mirroring economic strategies from the 2017 Tax Cuts and Jobs Act (TCJA), the bill’s projected impact has been modeled using similar macroeconomic assumptions that proved accurate during Trump’s first term.
Key State-by-State Findings
According to the CEA analysis:
- California: Wage gains of $7,500 to $14,300; take-home pay increases up to $16,000.
- Texas: Wage gains between $6,000 and $11,300; families may see an additional $13,000 in income.
- Florida and Georgia: Take-home pay increases of $7,500 to $12,700 projected.
- Virginia: Estimated wage increases between $6,900 and $13,100; after-tax income could rise by $14,800.
- Alabama and Arkansas: Even lower-income states forecast increases up to $10,800 per household.
How the Model Works
The CEA based its projections on established economic models used in the evaluation of the 2017 TCJA. The methodology calculates how GDP, investment, labor supply, and wages respond to changes in marginal tax rates. In addition to corporate tax reductions, the bill includes incentives aimed at boosting R&D, factory investment, and household income through labor-market effects.
Outlook
If passed, the bill could reshape the American tax code for decades, with projections showing a national lift in consumer purchasing power, private sector growth, and job creation. While critics have questioned the scale of deficit reduction promised alongside tax cuts, the administration contends that a stronger economy will generate sufficient revenue to offset cuts.
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