Farmers like few things more than extra money in their wallets. During the 2024 campaign, President Donald Trump repeatedly vowed to lower taxes. Now, empowered by a Republican House and Senate, he’s looking to fulfill that promise in his “big, beautiful bill.”
During the first Trump administration, Congress passed the 2017 Tax Cuts and Jobs Act. It includes provisions on estate taxes, capital expense deductions and qualified business expense deductions. The law will expire at the end of 2025 if Congress doesn’t act.
According to a recent American Farm Bureau Federation analysis, failing to extend the TCJA would force farmers and ranchers, in total, to pay about $9 billion more in federal taxes. That equates to about $5,155 per year in taxes for the average farm, per AFBF data.
Farm Bureau also warns additional taxes could cost 49,000 jobs, as farmers look to cut back on expenses. This could potentially add up to $3 billion in lost wages. AFBF President Zippy Duvall notes that farmers and families across the country are already struggling with higher prices.
“Farmers’ paychecks have shrunk at the same time because what they’re paid for their product has bottomed out, threatening the economic sustainability of rural America,” Duvall said in a June 2 news release. “Congress now has the opportunity to provide some stability for the men and women who work every day to ensure pantries are stocked for families across our country.”
Will lower taxes bring more stability?
Critics say focusing solely on tax cut savings is misleading, because it doesn’t take into account other provisions with the potential to harm rural communities.
The budget proposal passed by the House in May includes massive tax cuts. Now, the Senate has begun hammering out its own budget legislation, with an ambitious target completion date of July 4.
The House version would make the 2017 Trump tax cuts permanent. Combined with other provisions, including additional rate cuts and deductions, the bill would decrease federal tax revenue by $4 trillion over the next 10 years. When projected revenue over the same time period is taken into consideration, that net revenue reduction would be closer to $3.1 trillion, according to the Tax Foundation.
To offset some of that past revenue while increasing border enforcement and defense spending, the House slashed health care funding and cut nearly $300 billion in Supplemental Nutrition Assistance Program funding.
According to a 2025 USDA Economic Research Service report, the loss of nutrition program spending will reduce farm income by about $30 billion. USDA data also shows SNAP spending generates more economic output and employment in rural areas.
According to the National Grocers Association, a trade association representing independent supermarkets, SNAP funding brings in more than $4.5 billion in state and federal tax revenue. It also accounts for approximately 388,000 jobs and more than $20 billion in direct wages.
In a May statement following the House reconciliation bill, NGA President and CEO Greg Ferrara applauded many of the tax provisions in the House bill. While acknowledging those provisions were “much needed,” he called the SNAP cuts “deeply concerning.”
“Independent grocers see firsthand how SNAP supports families during hard times, strengthens the food supply chain, and fuels economic activity in neighborhoods where every dollar counts and is reinvested locally,” Ferrara said. “As the reconciliation process moves to the Senate, we look forward to working with lawmakers to protect Main Street communities, and strengthen this critical program by ensuring it is sufficiently funded and efficiently implemented while addressing unacceptable fraud and error rates.”
Also, according to projections by the nonpartisan Congressional Budget Office, Medicaid funding cuts in the House bill could leave nearly 11 million people without health insurance by 2034. An additional 5.1 million would lose coverage due to proposed changes in Affordable Care Act enrollment rules and ACA tax credits set to expire this year.
The CBO also estimates the “big, beautiful bill” will add $2.4 trillion to the national deficit over the next 10 years. In the coming decade, that would cost the government hundreds of billions in interest. It could also mean higher interest rates on consumer debt.
What happens now?
Multiple Republican senators have already indicated they may not vote for the bill if it includes that much additional debt. Others have expressed concern over plans to move some SNAP funding responsibilities over to the states.
Despite this, Trump continues to push for a bill that includes his key priorities such as major tax cuts.
There is little debate that those cuts would put more money in farmers’ bank accounts. The yet-to-be answered question is how much of it will ultimately stay there?