Eight years ago today, President Donald Trump signed historic tax cuts into law, spurring an economic boom.
The 2017 Tax Cuts and Jobs Act, passed exclusively by Republicans in Congress, delivered major wins for women, workers, households, and businesses of all sizes.
The TCJA was a sweeping tax reform package that touched every corner of America:
- Nearly every paycheck earner received a tax cut in 2017 as the law lowered tax rates across the board, boosting paychecks.
- It doubled the Child Tax Credit (CTC) for families with kids, freeing up resources for big-ticket purchases like a new car or family trips.
- It doubled the standard deduction, simplifying taxes for millions of people.
- The corporate tax rate was slashed from 35% to 21% to be competitive with other nations.
- Small businesses organized as “pass-through” entities—likely many of the 12 million women-owned businesses—were provided a 20% deduction (199A) to bring their tax rates closer to the new, lowered corporate rate.
If we measure the impact of a law on the outcomes, the TCJA’s impact was undeniably positive:
Households Prospered
- Median household income reached an all-time high of $68,703 in 2019.
- Real median household incomes grew by more than $5,000.
- The poverty rate fell to a record low.
- 4.2 million Americans were lifted out of poverty.
- Taxpayers spent 2 billion fewer hours on paperwork in 2020 compared to 2017—a time savings worth over $50 billion.
Workers Won
- U.S. companies added 4.7 million new jobs within the first two years.
- The unemployment rate reached a 50-year low of 3.5%.
- Black unemployment reached a historic low.
- Hispanic unemployment reached historic lows.
- Real wages rose by 4.9%—the fastest growth in twenty years.
- Thousands of businesses nationwide gave bonuses, pay increases, and new benefits such as health care. Many women also enjoyed new family benefits, particularly paid family leave.
The Economy Boomed
- Total corporate investment rose by about 11%.
- Gross Domestic Product rose by nearly 1% (for a $27 trillion economy, that’s at least $270 billion).
- Zero American businesses moved abroad.
- By FY 2022, tax revenues reached a record high of $4.9 trillion—beating expectations.
What’s Next?
Many provisions of the TCJA were set to expire next week on New Year’s Eve 2025. The consequences would have been detrimental to the U.S. economy.
The average taxpayer would have seen a 22% tax hike, as the Child Tax Credit and guaranteed deduction would have been slashed in half. Meanwhile, because of the expiration of deductions, 26 million small businesses faced a steep 43.4% top tax rate.
Thankfully, the Working Families Tax Cut (WFTC) Act (also known as the One, Big, Beautiful Bill Act) was passed by conservatives and signed into law on July 4 of this year by President Trump. The OBBBA makes the TCJA permanent and builds upon it in many popular ways:
Under the OBBA:
- Individual income tax rates stay low.
- The standard deduction is enhanced and doubled permanently.
- The Child Tax Credit is enhanced and made permanent.
- Estate exemption raised: Increased to $15 million.
The OBBA adds new popular tax savings for working Americans, kids, and seniors:
- NO tax on tips
- NO tax on overtime
- NO tax on car loan interest
- NO tax on Social Security earnings
So, instead of Uncle Sam taking a bite out of paychecks at the start of 2026, women and families can look forward to keeping more of what they earn. The OBBBA is projected to increase real wages in the U.S. up to $7,200 per worker, and take-home pay will rise by $10,900.
The business provisions will encourage businesses to reinvest and grow, leading to higher wages and more hiring. Some 7.2 million jobs are projected to be protected or created.
(Learn more about what’s in the OBBA for you.)
Bottom Line
Tax cuts work. The TCJA demonstrated that when workers, households, and businesses are taxed less, the economy grows and Americans thrive.