Business & Economy
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Business & Economy
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GOP tax bill would add $3.7 trillion to deficit: JCT
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The tax portion of the Republican policy bill would cost $3.7 trillion over the next decade, said Joint Committee on Taxation (JCT) found.
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That fits within the parameters laid out in the budget blueprint Congress adopted earlier this year, which allowed the House Ways and Means Committee up to $4.5 trillion for changes that could increase the deficit.
Tables from the JCT, which is the official revenue scoring body of Congress, show that extensions of the 2017 tax cuts and other measures will add about $5.6 trillion to the deficit, while cuts to renewable energy incentives and amped international tax enforcement will reduce the deficit by about $1.9 trillion.
The deficit addition is rubbing GOP budget hawks the wrong way, though some say they intend to be open-minded about it.
The core element of the GOP tax package is the extension of the individual rate reductions made in 2017, which put marginal tax rates at 10, 12, 22, 24, 32, 35, and 37 percent — most of which were brought down by a few percentage points.
Those rate continuations will reduce federal revenues by $2.2 trillion through 2034.
The extension of the increased standard deduction, which was $29,200 for married couples and $14,600 for individual filers in 2024, would add $1.3 trillion to the deficit.
However, the Trump tax cuts also did away with personal exemptions, which more than offset the cost of a higher standard deduction and will contribute $1.8 trillion in federal revenues through 2034.
The Hill’s Tobias Burns has more here.
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Welcome to The Hill’s Business & Economy newsletter, I’m Aris Folley — covering the intersection of Wall Street and Pennsylvania Avenue.
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Key business and economic news with implications this week and beyond:
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Microsoft on Tuesday began laying off nearly 3 percent of its total workforce — or about 6,000 employees.
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Businessman Kevin O’Leary said he believes a forthcoming trade deal with the United States’ and China will serve as a model for other nations.
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Small business optimism dipped in April for the fourth month in a row, according to the monthly National Federation of Independent Business (NFIB) survey released Tuesday.
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The tech industry is breathing a sigh of relief after the U.S. and China agreed to substantially lower tariffs, underscoring the prospect of de-escalation in a trade war that has been particularly challenging for the sector.
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Republicans, Johnson to meet as impasse hardens
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Moderate Republicans from high-tax blue states are set to meet with Speaker Mike Johnson (R-La.) on Tuesday, as the impasse over the state and local tax (SALT) deduction cap hardens.
News of the gathering comes shortly after Rep. Mike Lawler (R-N.Y.), one of the most vocal supporters of increasing the SALT deduction cap, said negotiations between the SALT Caucus and leadership had not been happening.
The House Ways and Means Committee, which has jurisdiction over taxes, included a $30,000 SALT deduction cap for individuals making less than $400,000 in its portion of the GOP’s megabill — triple the current $10,000 cap — which those in the SALT Caucus rejected.
The group is pushing for a higher cap: During a meeting Monday with Johnson and Republicans on the House Ways and Means Committee, the group floated a $62,000 cap for single filers and $124,000 for joint filers — a large difference from the proposal in the text.
Asked about conversations Tuesday, Johnson said the group was nearing an agreement.
“We’re still having discussions, dialogue this afternoon, working on it. And we’re very close, I think, to finally resolving it,” Johnson said.
Mychael Schnell has more here.
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Tax Watch is a regular feature focused on the fight over tax reform and extending the 2017 Trump tax cuts this year. Email a tip
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Upcoming news themes and events we’re watching:
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- The House Ways and Means Committee and House Energy and Commerce Committee are expected to continue markups Wednesday.
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Branch out with more stories from the day:
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WASHINGTON (AP) — Online shoppers in the U.S. will see a price break on their purchases valued at …
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Business and economic news we’ve flagged from other outlets:
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- S&P 500 closes higher Tuesday, wiping out 2025 loss, as Nvidia surges (CNBC)
- Tariffs have already made mattresses, strollers and power tools more expensive (CNN)
- CFPB Drops Biden-Era Lawsuit Against Walmart, Fintech Partner (Bloomberg)
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Top stories on The Hill right now:
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The Democratic National Committee (DNC) has taken a first step toward possibly requiring a new election for two of its vice chairs, including David Hogg, who has stirred controversy with his call for primary challenges to longtime incumbents in safe seats. Read more
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A federal judge ruled Tuesday that President Trump can invoke the Alien Enemies Act (AEA) to remove Tren de Aragua members but determined the administration has provided insufficient notice before carrying out the deportations. Read more
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Opinion related to business and economic issues submitted to The Hill:
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You’re all caught up. See you tomorrow!
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