Congress is moving fast on a sweeping package known as the “One Big Beautiful Bill” (OBBB)—and it could have real implications for Louisiana. While the OBBB includes some beneficial provisions, especially by extending the 2017 Trump tax cuts, the bill overall fails to deliver the kind of fiscal discipline and pro-growth reform America needs. If anything, it reflects a dangerous continuation of Washington’s deficit spending spree. That’s a warning sign for Louisianans who want to see lower taxes, more opportunity, and a more responsible federal government.

The OBBB: What It Gets Right—and What It Doesn’t

The U.S. House recently passed the OBBB, which is now under review in the Senate. The legislation would:

  • Extend expiring provisions from the Tax Cuts and Jobs Act (TCJA),
  • Eliminate taxes on tips and overtime pay,
  • Make Social Security benefits tax-free for many seniors,
  • Extend full expensing and other pro-growth business tax cuts,
  • Raise the state and local taxes (SALT) deduction cap to $40,000,
  • Implement modest work requirements for Medicaid and SNAP,
  • Roll back certain Biden-era clean energy subsidies.

Extending the TCJA helps maintain some degree of predictability for taxpayers and businesses. That alone reduces uncertainty and allows for better planning and investment. However, the other so-called “relief” measures are classic tax code distortions. Exempting tips, overtime, or Social Security benefits from taxation may sound good politically, but they complicate the code and narrow the base. Every carveout like this means higher tax rates elsewhere or more debt. Instead, the focus should be on across-the-board rate reductions funded by spending restraint.

Still Too Much Spending, Still Too Many Gimmicks

While the tax reforms in the OBBB are directionally helpful, the bill still suffers from two major flaws:

  1. It spends too much. Instead of focusing on deficit reduction, the OBBB layers tax relief over another pile of federal spending even after spending about $1.5 trillion less than otherwise over a decade. But most of the spending reductions are delayed and should be immediate like tax reforms. As Adam Michel at Cato points out, the Senate must fix this by cutting wasteful expenditures, corporate welfare, and unnecessary industrial policy subsidies.
  2. It’s riddled with carveouts. Rather than simplifying the tax code and broadening the base, the bill is filled with new preferences and targeted cuts—precisely the kind of special-interest favoritism that distorts economic incentives.

These problems weaken the bill’s long-term pro-growth impact. Without real fiscal restraint, any tax cuts today risk becoming tax hikes tomorrow.

What It Means for Louisiana

Louisiana taxpayers may see a short-term benefit. Workers could take home more pay, and families might enjoy marginally lower tax burdens. But federal fiscal irresponsibility won’t stay in Washington. It ripples through the economy. When Congress runs massive deficits, it puts upward pressure on inflation and interest rates—costs that fall disproportionately on low—and middle-income Americans. If spending continues unchecked, future tax hikes or program cuts are inevitable.

How Will It Affect My Taxes?

  • If you’re a tipped or hourly worker: Your paycheck could go up.
  • If you’re a retiree: You might stop paying federal taxes on Social Security benefits.
  • If you itemize deductions: The higher SALT cap could ease your burden.

These are tangible benefits. But they come with a cost—unless matched with spending reductions, they contribute to an unsustainable fiscal trajectory.

How Will It Affect My Job?

In the short term, businesses may benefit from lower tax compliance costs and marginally stronger hiring incentives. But rising federal debt threatens to crowd out private investment over time. Louisiana’s economy, heavily dependent on energy, trade, and small businesses, needs more than tax tweaks. It needs a leaner federal government.

A Missed Opportunity to Do Better

The U.S. Senate can—and should—fix the worst parts of the OBBB. That means:

  • Making the TCJA tax cuts permanent across the board,
  • Eliminating new carveouts and corporate subsidies,
  • Reducing federal spending,
  • Simplifying the tax code to maximize growth.

These changes would help ensure tax relief isn’t just a temporary sugar high. They would also align with Louisiana’s needs: broad, lasting reforms that empower workers and businesses without fueling inflation or debt.

The Louisiana Connection

Back in Baton Rouge, lawmakers are navigating their budget debates. Thanks to economic growth and some early tax reforms, new revenue—roughly $155 million—is on the table. However, too much of the state budget is still soaked in pork projects and misplaced priorities. For example, the Senate Finance Committee just slashed funding for the new LA GATOR program to help families choose a school or educational program that fits their child’s needs, yet increased funding for the public schools families are trying to leave. They also added millions in more pork projects. This is precisely why Louisiana needs a Responsible Louisiana Budget, which would cap spending growth at the rate of population growth plus inflation. It’s a simple rule to ensure the budget doesn’t grow faster than what taxpayers can afford. If federal aid begins to shrink or federal work requirements increase state responsibilities, Louisiana will need even more discipline to weather the storm.

The Bottom Line

The One Big Beautiful Bill is a mixed bag. It offers short-term tax relief, especially by extending the TCJA, but fails to rein in the federal spending binge sufficiently. It’s not the pro-growth reform Americans need. At best, it reduces uncertainty by keeping some of the 2017 tax cuts in place. Louisiana lawmakers and residents should take note. Don’t count on D.C. to get this right. Push the Senate to improve the bill. And demand real spending discipline at the state level to ensure federal relief translates into real prosperity, not more fiscal risk.