WICHITA, Kan. (KWCH) – Proposed legislation containing nearly $4.5 million in tax cuts has generated discussion about its potential economic impact across different income groups. Dr. Larry Straub, Associate Professor of Management at Newman University, has analyzed the distributional effects of these proposed tax reductions.
According to Dr. Straub, the tax cuts would primarily benefit individuals with existing financial assets. “Those who participate in the stock market, maintain investment portfolios, or own businesses would likely see significant benefits,” he explained. “This primarily affects the top third of income earners who would receive disproportionate advantages from these provisions.”
However, the analysis also identifies potential benefits for lower-income workers. Dr. Straub noted that hourly employees could benefit from tax exemptions on tips and overtime pay. “Workers receiving overtime compensation would likely benefit from these provisions,” he stated. “Individuals employed in restaurants or other service industries where tipping occurs could see meaningful income increases, given the expanding culture of tipping in various service sectors.”
While acknowledging potential benefits for certain groups, Dr. Straub expressed concerns about potential reductions in social services that might accompany the tax cuts. He specifically highlighted potential impacts on Medicaid funding, which could disproportionately affect lower-income households. “For individuals at the lower end of the income spectrum, there’s little doubt they would bear significant costs to fund these tax reductions,” he observed. “Regardless of political perspective, this appears to be an economic reality.”
The legislation, informally referred to as the “Big Beautiful Bill,” has reached a critical stage in the legislative process. According to official statements, the President intends to sign the bill into law on the Fourth of July. Documentation from the White House website indicates that the legislation would increase take-home pay for Kansas residents by $6,900 to $11,700 annually.
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Economic expert weighs in on “Big Beautiful Bill’s” impact on taxpayers
WICHITA, Kan. (KWCH) – President Trump’s “Big Beautiful Bill” looks to pass nearly $4.5 million in tax cuts. Newman University Associate Professor of Management Dr. Larry Straub says the cuts will help out people already in the upper class.
“If you’re in the stock market, if you’ve got a stock portfolio, if you own a business,” said Dr. Straub. “Those type of folks are probably going to do pretty well with this so you may be talking the top third of the spectrum that will probably get some out sized benefits.”
But Dr. Straub says that’s not the only group who could find benefits to the policies in the BBB. He says hourly workers could benefit from no taxes on tips and overtime pay.
“You get overtime? Probably going to work out fairly well for you,” said Dr. Straub. “If you’re working at a restaurant or a place where you get tips look at how much we all tip right now, places we didn’t used to tip we tip, so there’s going to be a pretty large swath of the population that’s going to do okay with that.”
Dr. Straub says while the cuts could help some Americans, he is worried about how the cuts to services like Medicaid could impact people’s wallets.
“Obviously for the lower end of the spectrum there’s just not much doubt that they’re taking a lot of the hits to pay for this thing,” said Dr. Straub, “so love that or hate it, think what you will, I think that’s pretty factual.”
President Trump is expected to sign the bill into law on the Fourth of July. According to the White House website, the “BBB” will increase take home pay in the state of Kansas by $6,900 to $11,700.