BBB, The Bigger is The Winner?
The “Big Beautiful Bill,” as analyzed by the Penn Wharton Budget Model (May 20, 2025), reveals a sharp contrast in its impact across income groups by 2026. Lower-income households—the 1st and 2nd quintiles earning up to $51,000—experience a decline in after-tax-and-transfer income, with the poorest group losing an average of $940 (-13.6%).
In contrast, higher-income households see substantial gains. Middle earners (3rd and 4th quintiles) benefit modestly, with increases ranging from $815 to $5,795. The wealthiest 5th quintile, particularly those earning over $4.3 million, receive the largest boost—an average of $390,310 (+3.1%). The pattern shows a clear shift of financial benefits toward the top earners, raising concerns about equity and fairness. While it may stimulate investment or economic activity at higher levels, it disproportionately burdens low-income groups. The bill reflects a regressive economic impact, potentially deepening income inequality unless adjusted through targeted policies.
