House GOP unveils tax bill with $4 trillion in tax cuts, $1.5 trillion in offsets. In draft legislation released Monday, the House Ways and Means Committee laid out the main elements of President Trump’s multi-trillion-dollar tax cut proposal. The bill would cut taxes by more than $4 trillion and assumes spending reductions of at least $1.5 trillion over a decade. It would make Trump’s 2017 individual tax cuts permanent, while also providing a temporary boost to the child tax credit and standard deduction. It would also temporarily eliminate taxes on tips and overtime pay, two ideas proposed by Trump during the campaign. It would also increase the state and local tax (SALT) deduction cap to $30,000 for couples, though lawmakers from high-tax states say that’s still too low. A $4,000 standard deduction bonus for seniors replaces Trump’s previously proposed plan to exempt Social Security benefits from taxation.
Who gains from the House tax plan? Mostly high-income households. A new TPC analysis reviewed the draft bill released on May 9, finding that while all income groups would see a tax cut under the GOP bill, high earners benefit the most. Households making over $200,000 would receive more than two-thirds of the plan’s total tax cuts, with the top 1 percent seeing average cuts of over $100,000. Meanwhile, the bottom 20 percent of earners would receive an average tax cut of just $120. About 6 percent of households, mainly in the $100,000–$200,000 income range, could see their taxes rise. The May 9 proposal did not include the SALT cap or the tax breaks for overtime, tips, and seniors.
US and China ease trade tensions—temporarily. In a joint announcement Monday, the US and China agreed to a 90-day suspension of recent tariff hikes. The US will reduce tariffs on Chinese goods from 145 percent to 30 percent, while China will lower duties on US goods to 10 percent from 125 percent. While the truce may relieve some pressure on global supply chains and markets, experts caution that the pause does not resolve deeper trade issues, and tensions may return if talks falter.
IRS staff exodus may undermine future hiring. As reported by Tax Notes, former IRS leaders say recent layoffs, buyouts, and rescinded job offers will have long-term consequences for the agency’s talent pipeline. The IRS has already struggled with recruitment and onboarding delays, and a governmentwide hiring freeze is compounding the issue. Officials warn that even if future administrations restore funding, rebuilding IRS capacity won’t be quick or easy. “You can’t just switch the hiring process back on,” said former counselor Tom Cullinan.
Hollywood asks President Trump for more tax incentives. Hollywood studios and entertainment unions are lobbying President Trump to include expanded film and TV tax incentives in the upcoming budget bill. In a letter dated Monday, the Motion Picture Association and groups representing writers, actors, and behind-the-scenes workers urged Trump to extend federal production incentives. Jon Voight, one of Trump’s “Hollywood ambassadors,” is leading the effort.
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