CBO reports Trump tax law gives rich $13,600 boost while poor lose $1,200 yearly

The Congressional Budget Office (CBO) has reported that the tax law championed by Donald Trump will result in a significant redistribution of income, with the poorest Americans experiencing a $1,200 annual loss, while the richest see a $13,600 boost [1]. The law, which Republicans pushed through Congress in July under the slogan “the big, beautiful bill,” has been met with strong opposition from Democrats, who argue it undermines essential government aid programs and exacerbates the national debt [1].

According to the CBO, the 10% of Americans with the lowest incomes will face reduced access to government programs such as Medicaid and food assistance, contributing to the $1,200 annual cut in their income. Meanwhile, the top 10% of earners will benefit most from tax cuts, experiencing an average $13,600 increase in income. While middle-class households will see some income gains, the report highlights a clear imbalance in how the benefits are distributed [1].

The CBO’s analysis also points to the impact of new work requirements in the law, which could exclude around 2.4 million people from the Supplemental Nutrition Assistance Program (SNAP). Additionally, the law’s changes to Medicaid are projected to leave more than 10 million Americans without health insurance by 2034 [1].

Democrats have been vocal in their criticism. Rep. Brendan Boyle, the top Democrat on the House Budget Committee, stated that the law “is really a big, beautiful bill for billionaires,” while poor and working-class families are left worse off. Rep. Jason Smith, the Republican chair of the House Ways and Means Committee, however, dismissed the CBO’s findings, arguing that the agency has a history of inaccurate estimates and a bias toward higher federal spending [1].

As lawmakers campaign in their districts during their summer recess, many Republicans have encountered strong public opposition to the law. In Lincoln, Nebraska, for example, a crowd chanted “Tax the rich” as Rep. Michael Flood attempted to defend the legislation [1].

The White House has continued to support the law, with deputy press secretary Abigail Jackson stating that it is “putting America First like never before,” delivering economic benefits and strengthening national security [1]. However, the CBO’s findings suggest that the law may deepen existing economic disparities, raising questions about its long-term impact on the American public.

Source: [1] CBO: The poor get a $1,200 income cut and the rich get a $13,600 boost from Trump’s tax law (https://fortune.com/2025/08/12/what-does-trump-tax-law-mean-rich-poor-middle-class/)