President Trump signed his so-called \u201cOne Big Beautiful Bill Act\u201d last week \u2014 an omnibus tax and spending package that could significantly reshape the social safety net both nationally and in New York.<\/p>\n
The $4.5 trillion law funds continuing tax cuts for the wealthy, originally passed in 2017 during Trump\u2019s first term, as well as beefing up immigration enforcement and border security. It pays for the increased spending on those priorities by making steep cuts to services like Medicaid and the Supplemental Nutrition Assistance Program (SNAP), also known as food stamps.<\/p>\n
Trump signed the law on July 4 after it passed the House mostly along party lines<\/a> last Thursday.\n<\/p>\n The legislation\u2019s passage drew immediate rebukes from New York Democratic elected officials, who warned that it will devastate both the city and state budgets and cut public assistance for millions of people.<\/p>\n \u201cThere\u2019s nothing beautiful about this bill. It\u2019s a big, ugly betrayal \u2014 stripping health care, hiking costs and slashing food assistance for millions,\u201d Hochul said in a statement after Trump signed the bill last week. \u201cI\u2019ve been very clear that no state can backfill the massive cuts in this bill or undo the damage Republicans just caused. But my team and I are working closely with the legislature to brace for the impact and protect as many New Yorkers as possible.\u201d<\/p>\n Hochul signed off on a $254 billion state budget<\/a> in early May, which significantly increased spending, while mostly not accounting for the looming federal funding reductions. She and state legislative leaders are reportedly huddling in Albany<\/a> this week to assess the law\u2019s impact on the state spending plan.<\/p>\n The legislation has certain measures that will take effect immediately, such as raising a cap on the state and local tax deductions \u2014 known as the SALT. Other provisions, like new Medicaid eligibility rules<\/a>\u00a0that will significantly reduce the program\u2019s rolls, will not kick in until next year or later.<\/p>\n SALT Cap<\/p>\n Raising the $10,000 SALT cap, which was instituted when Trump first passed his massive tax cuts in 2017, was a top priority of New York\u2019s Republican Congressional delegation \u2014 all seven members of which voted for the spending package.<\/p>\n The change will see the cap raised from $10,000 to $40,000 starting this year. The full deduction will be for taxpayers earning up to $500,000 annually, with an income phase out. The deduction will revert back to $10,000 in 2030.<\/p>\n Hudson Valley GOP Rep. Mike Lawler, who was a big proponent of raising the SALT cap, posted a video to social media on July 3<\/a> that celebrated the law as providing \u201chistoric tax relief.\u201d<\/p>\n \u201cI\u2019m proud of the work we did to lift the cap on SALT, increasing it 4x, increasing it to $40,000 from the current $10,000 cap, providing the largest tax cut in the entire bill,\u201d said Lawler, who represents a vulnerable House seat and is mulling a run against Hochul next year.<\/p>\n However, the Fiscal Policy Institute, a New York-focused economic policy think tank, estimates those making $300,000-a-year or below are \u201cunlikely to benefit from the change at all.\u201d\n<\/p>\n No tax on tips<\/p>\n Another provision in the law will allow tipped workers to deduct $25,000<\/a> in tips annually from their taxes. Anything over that amount will still be federally taxed.<\/p>\n