How the ‘big, beautiful’ tax and budget bill will hurt Idahoans

Budgets are not just about money – they also reflect the values and priorities of a state and country. That is especially true now as the Republican-controlled Congress considers the “big, beautiful” tax cut bill President Trump wants approved.

If the final bill contains the tax cuts and budget cuts currently under consideration, it will be the largest tax cut in American history and one of the biggest program cuts in the history of the country as well. It would call for tax cuts of about $4.5 trillion — yes, that’s trillion – and billions of dollars in budget cuts to programs that benefit millions of Americans.

Even though most Americans will get something from the tax cuts, 45 percent of the tax savings will go to Americans earning more than $450,000 per year, according to the independent Tax Policy Center. 

Another study by the Wharton Business School at the University of Pennsylvania estimated that the lowest 80 percent of taxpayers would get 29 percent of the tax cuts, while the top 10 percent of income taxpayers would get 56 percent. 

The Tax Policy Center study said about 13 percent of middle-income families would see a tax increase with the plans currently under consideration. The greatest benefit families would receive is the extension of the current $2,000 per child tax credit which might even increase to $2,500. Even that benefit would be cut in half if Congress doesn’t act this year.

To help offset some — yet not all — of the cost of the tax cuts, Congress is looking to cut $1 billion from programs that benefit the most vulnerable Americans, especially children. They are looking at cutting or making it more difficult for low-income families to qualify for Medicaid, they are looking at cutting $230 billion from the Supplemental Nutrition Assistance Program (SNAP) which 40 million Americans rely on for food. Even the Children’s Health Insurance Program (CHIP), which provides health care for a third to more than 40 percent of children in 43 of Idaho’s 44 counties could be impacted. 

Idaho’s counties are already feeling the financial pinch of the Trump administration and Congress cutting funding for the Rural Schools and Community Self-Determination Program. For example, Valley County will lose $1.3 million for schools, road projects, and suppression projects, according to the McCall Star-News. 

Under the Republican Congress’ plan, the biggest cuts would come from the Medicaid program, which would have a major negative impact on millions of Americans and Idahoans.

One in five Americans – 20 percent – get their health care through Medicaid. In 2024, more than 322,353 Idahoans received Medicaid support, including three out of every eight children, according to KFF, a nonprofit health group. The reliance on Medicaid is especially high in rural Idaho where a quarter of citizens rely on the program. 

Congress also has plans to cut Medicaid payments to public schools, which are used to provide mental health support and other support for students. This will especially affect Idaho where we have one of the highest youth suicide rates in the country, according to Mental Health America.

But the Trump-GOP Congress plan will not just impact vulnerable Idahoans and other citizens. It will drive up the federal budget deficit by trillions of dollars, according to the independent Tax Foundation. The added interest on that debt will reduce the standard of living for Americans by at least one percent, offsetting part of the tax cut benefits, the Tax Foundation said.  

To make matters worse, the Trump administration and Congress are looking to provide a $5 billion dollar-for-dollar tax credit for high income taxpayers to provide vouchers for private and religious schools. This voucher program will not only increase the federal deficit and provide an attractive tax shelter for high income taxpayers, but it will also undermine our already underfunded public schools in Idaho by providing a federal subsidy to competing private and religious schools.

One proposal is to reduce federal matching funds for states that have expanded their Medicaid programs to support working families who can’t afford health care on limited paychecks. In Idaho, 90,000 Idahoans receive health care under the Medicaid expansion program approved by voters a few years ago.

Amid protests and Democratic pushback, U.S. House GOP launches work on Medicaid cuts

If federal funding for Medicaid expansion is reduced and the state doesn’t pick up the added cost, these 90,000 Idahoans could lose their health insurance. If that happens, uninsured Idahoans would be one serious illness or accident away from financial ruin.

Moreover, the only place uninsured Idahoans could go for care is to the emergency room at local hospitals which would double or even triple the cost of their care. In the view of one Idaho health leader, such a scenario would be financially “catastrophic” for Idaho hospitals, especially in rural communities where so many Medicaid recipients live.

One idea is to require all Medicaid recipients to work. But a study by KFF shows that most recipients already work. 

The political challenge Republican members of Congress face is that up to 25 million Republicans are on Medicaid, according to KFF. Former Trump adviser Steve Bannon was quoted in The Washington Post as saying that “a lot of MAGA’s on Medicaid.” Even House Speaker Mike Johnson has one of the highest percentages of constituents on public health insurance, according to the Post.

Missouri Sen. Josh Hawley wrote in The New York Times this week that it would be political suicide for Republicans to cut Medicaid. He said the party would be responsible for the closure of rural hospitals that could not survive the cuts or the added expense of treating people in their emergency rooms. He warned that it would “represent the end of any chance of us becoming the working-class party.” 

Meanwhile, you wouldn’t know it because he doesn’t advertise it, but Idaho’s own senior Sen. Mike Crapo, who chairs the powerful Senate Finance Committee, will be a key player in what the final tax and spending cut bill looks like. On May 9, Politico quoted Crapo as saying he has concerns about cutting Medicaid and SNAP programs. 

“I’m not excited about the proposal, but I have to say, there are a number of people in both the House and the Senate who are, and if the president weighs in favor of it, then that’s going to be a big factor that we have to take into consideration as well,” Crapo said in an interview with talk show host Hugh Hewitt, according to Politico.

Politico said Crapo has been an outspoken advocate for essentially writing off the cost of permanently extending the tax cuts and accounting only for any new tax provisions. That is surprising since Crapo has made a career of calling for reducing the federal budget deficit. 

What Idahoans need to know in this complicated dance over tax and budget cuts is this: Half or more of the tax cuts will benefit more economically affluent taxpayers and most of the budget cuts will be on the backs of low-income Americans, including thousands in Idaho.

Furthermore, the “big, beautiful bill,” as President Trump describes it, will do nothing to reduce the $36 trillion-dollar federal debt. In fact, it is likely to make the deficit even bigger, leaving the mess for our kids and grandkids to clean up someday. 

All so the most affluent taxpayers can receive a “big, beautiful” tax cut.