Trump presents huge tax package: effects for Germany too!

Trump presents huge tax package: effects for Germany too!

Today, July 4, 2025, there are some exciting developments to report in the global political arena. A special focus is on the recently passed tax and spending law “Big Beautiful Bill”, which was passed by Borken newspaper was presented as one of the central themes of the day.

The law, which was formally passed in the House of Representatives under the chairmanship of Mike Johnson with 215 votes in favor and 214 against, brings massive tax cuts amounting to $4.5 trillion. These reliefs come from the Trump administration's political initiatives and are primarily intended to benefit medium-sized companies and investors. While Trump promises comprehensive growth, critics and supporters must ask themselves whether it will actually succeed in strengthening the US economy or whether the law will only benefit already wealthy Americans. daily news reports that the Senate still has to agree before the bill finally comes into force.

The core content of “Big Beautiful Bill”

The key proposals include not only tax relief, but also significant spending on defense and border security. Among other things, the following points are set out in the law:

• Verlängerung der Einkommensteuersätze der Trump-Ära bis 2026.
• Erhöhung des Standardabzugs für Einzelpersonen um 1.000 USD und für Ehepaare um 2.000 USD.
• Einführung neuer Abzugsmöglichkeiten für Trinkgelder, Überstunden und Altersausgaben.
• Erhöhung des Kinderfreibetrags auf bis zu 2.500 USD.
• Erhöhung des Verteidigungshaushalts um 150 Milliarden USD.

However, there is also the threat of severe cuts in social programs: up to 8.6 million people could lose their health insurance as a result of planned changes to Medicaid. Us Chancellery highlights the risks that welfare work mandates and food stamp cuts could affect approximately three million Americans.

Capital and investments in focus

The law also poses a certain risk for foreign investors, especially from Germany, Austria and Switzerland. The changes in US tax law could make it necessary to review existing investment structures and adapt them if necessary. From 2025 there is a risk of higher withholding taxes on income from certain countries, which could be understood as a “retaliation tax”. This means that there are also significant challenges for investors from the DACH region, while at the same time new opportunities are opening up for US investors.

With a view to international conditions, the fateful day of Ashura for Shiite Muslims in Najaf, Iraq, was also mentioned in Cologne and elsewhere. Religious processions and mourning rituals characterize this day and show the cultural diversity that is present in an international context alongside the many political reports.

It remains to be seen how the situation surrounding the “Big Beautiful Bill” will develop and what impact it will have on American society and international relations. The pressure from President Trump on the legislators is clearly noticeable - there is certainly little room for regression.