listening in there as one of the key components of this uh big beautiful bill is that no tax on tips and you can see this from the White House saying check mark the one big beautiful bill delivers the largest tax cut in history for American uh the working middle class group there let's be joined right now by Alex Morishanu a senior policy analyst at the fact foundation Alex thank you so much for joining us here on live now from Fox give me some details dive into some of the finer points of this bill. What do you make of it and the impacts it has on those average working Americans? I think the name the term beautiful is up to a lot of different people might disagree about that, but this bill is undeniably big. Um there are a lot of different provisions to cover. The big sort of reason for the bill happening was the scheduled expirations of the Tax Cuts and Jobs Act, uh, individual tax cuts in that were passed in 2017. Uh, and so those are extended in both versions of the bill permanently. Um, that lowers income tax rates across the board. Makes some changes to major itemized deductions. The standard deduction gets bigger. Um, gets slightly incrementally bigger as well. um uh in different versions. Um and you also have some big business provision uh you know pro-investment provisions uh get extended permanently in the in the Senate version um for investment new investment in equipment and R&D. Um but also you've got a lot of other you know Trump campaign promises are introduced for a couple years. um the overtime, no tax on overtime, no tax on tips, the um you get a boost for the standard deduction for seniors, uh instead of the uh no tax on social security idea. There's a lot to cover. Yeah. And you wrote an article for the tax foundation called the good, the bad, and the ugly with this big beautiful bill. And like you mentioned, subjective about the beauty nature of it, but it is in fact big. There are also uh people coming out, even some Republicans talking about some of the impacts this has had. Can you get into the ugly? What are some of those conversations about? What are some of the points about uh that in this big beautiful bill? I mean, I think the uh ugly aspect is the tax code seems like it's going to on that get more complicated. Tax Cuts and Jobs Act in 2017, the sort of signature, you know, big policy accomplishment, I guess, of the the first Trump term, uh, you know, on net ended up simplifying the tax code, got rid of a lot of of preferences, um, you know, and and simplified tax filing, you know, move people towards a standard deduction. Uh this bill introduces a lot of new sort of targeted provisions at different um uh you know different types of income whether it's no tax on tips or no tax on overtime as opposed to several other smaller provisions that just sort of generally generally we're moving in the wrong direction of streamlining the tax code and you know lowering rates and broadening bases. We do a lot this bill has a lot of you know narrowing the base uh uh sort of complexity enhancing uh uh moves um does go after the some of the credits passed in the inflation reduction act under the Biden administration that is a sort of base broadening simplification move but uh on the whole there are you know introduces a lot more um you know new complexity yeah that is to say the least an understatement in terms of this the complexities and one of the components there is the salt tax, the state and local tax, because the discrepancy between the Senate version and the House version is some $30,000. Do you think they'll be able to square that? And can you talk about maybe each version in terms of its impact on uh just the average working American? Uh yeah. So, I mean, on the state and local tax deduction, it looks like, you know, I think in the past, uh, what 24 hours, I think, uh, you know, time starts to blur together when you're dealing with one of these reconciliation packages. uh I think in the past 24 hours that they have moved to make what looks like a deal on on the salt deduction where the uh um salt cap is placed at $10,000 uh permanently, but for the first couple years, the uh final Senate bill uses the House bill uh cap of of $40,000 um and adjust it a little bit each year to sort of go along with inflation. So um you know it it looks like the the Senate has given given some ground to the House. Um you know that is another move that sacrifices I think the Senate holding the line initially on the salt cap of of 10,000 you know um not providing the the sort of bigger tax benefit to uh high tax states. Uh I think that and reducing itemized deduction usage which is what the salt cap did. Um I think it was a good move originally to keep it. It was good policy. It was good of the Senate to originally keep it, but they have uh um retreated off of it. All right. Another campaign promise from President Trump was that thing you mentioned, no tax on tips. What we what might we see from that? How much of a boost could that be uh to people that get tips that work in a service industry? What do we make of that no tax on tips provision? Well, I mean, I think the work the thing worth keeping in mind is, you know, you talk about impact for sort of middle middle class households or working-class households. I mean, the vast majority of households of any um income threshold are not earning their income through tips. It's not above 5% of of any of households at any income level, not above 5% of them uh earn their earn tips uh earn tipped income. Um now certainly for some taxpayers uh they will see substantial benefits. Um but in aggregate it's not a huge tax cut. Uh that part of the bill you know we had the overall bill depending on which one you look at you know has either 4 trillion in tax cuts um which is the the house version or 5 trillion in the Senate version. You know the no tax on tips provision is between 30 and 40 billion uh depending on the details. Um and also you know the lowest income earners uh you know people who work say part-time uh already are not paying income taxes because of the standard deduction and so that is a good chunk of tipped workers and so exempting tipped income from from income tax wouldn't help help those sort of part-time workers either. And I want to ask you my last question before I let you go to look at kind of the macro sense of this because the CBO coming back and saying this will balloon the deficit by some $4 trillion. I spoke to Erica York over there at the tax foundation about some of these numbers and this big beautiful bill is very reliant on the GDP and the growth of the United States. In terms of that, how much does it need to grow and how much does this bill support that economic growth component? Well, I think you know the especially the the Senate version does provide some additional growth uh largely driven by the ability uh giving companies the ability to to actually deduct the full cost of their of their capital investment. You know, that will make American workers more productive uh and and drive, you know, long run output growth. Um and that will help pay for some of this bill. Um but the uh uh what what we're looking at now, you know, the Senate version, uh you have, you know, about $5 trillion in in tax cuts. You know, we think the grow, you know, our new new numbers uh say that, you know, growth can pay for maybe 20% of that. Um which is not nothing. I mean, that's that's that's a trillion dollars of revenue feedback, but that's also, you know, $4 trillion that's that's not paid for. of the spending cuts uh about you know 1 trillion 1 trillion and change you know that also takes some of the cost out um but on the whole yes this bill will increase the deficit. Yeah and of course we're talking about tariffs as well complicating some of that the uncertainty factor and we heard from Senator Chuck Schumer saying this bill potentially could haunt Republicans moving forward as well. All right, Alex, thank you so much for joining us. I appreciate your time and your insight. It's a very complex bill, but I think you simplified it very good for our audience. Appreciate it.