The One Big Beautiful Bill Act Is Proving to Be a Fiscal Success

H.R. 1, the One Big Beautiful Bill Act (OBBBA) permanently extended the tax cuts from the Tax Cuts and Jobs Act of 2017 (TCJA), which were set to expire by the end of 2025.  The OBBBA also included both new and expanded tax deductions and credits designed to improve the lives of working American families.

OBBBA established new tax deductions for overtime pay, income from tips, and social security benefits, allowing taxpayers to keep more of their hard-earned money.  Small businesses have been boosted by increasing the Qualified Business Income deduction from 20 percent to 23 percent and making it permanent.  The law also restored the immediate expensing of domestic research and development costs and reduced complex and unnecessary filing paperwork.

According to the Congressional Budget Office (CBO)’s July 2026 Monthly Budget Review (MBR), non-tariff federal revenues, including income and payroll taxes, are projected to increase by $50 billion compared to its February 2026 MBR estimate.  House Budget Committee Chairman Jodey Arrington (R-Texas) said that this increase in revenue should be attributed to the OBBBA tax cuts: “Republicans’ pro-growth tax policies continue to generate more revenue than CBO anticipated, while low- and middle-income Americans are receiving record tax refunds.”

Although the higher revenue from the OBBBA is a step in the right direction, more needs to be done to move the country away from impending fiscal disaster.  As Chairman Arrington added, “We cannot simply grow our way out of a $2 trillion annual deficit and $40 trillion national debt.”  A good way to start the needed reduction in spending would be by adopting the recommendations in Citizens Against Government Waste’s Prime Cuts, which would save $606.2 billion in the first year and $5.4 trillion over five years.