Trump's Tax Strategy: Major Benefits for the Wealthy and Minimal Relief for Average Americans in Key U.S. Cities

The legislation, referred to as the "One Big Beautiful Bill," codifies and enhances the 2017 Trump tax cuts. It elevates the cap on state and local tax (SALT) deductions from $10,000 to $40,000, temporarily eliminates taxes on tips and overtime, and boosts the child tax credit by $500 until 2028. While this House-approved tax reform, endorsed by President Trump, claims to provide widespread relief, analysis from Penn Wharton reveals that it disproportionately favors affluent households, offering only minimal benefits—or even losses—for working-class families in cities like Baltimore, New York, Los Angeles, Detroit, Chicago, Houston, and Washington, D.C. To mitigate the estimated $2.8 trillion cost over ten years, the bill cuts Medicaid and the Supplemental Nutrition Assistance Program (SNAP) by over $1.2 trillion combined, leading to greater financial disadvantages for lower-income households, many of whom are Black or Latino.