Core Viewpoint - The "Great Beautiful Act" signed by Trump on July 4, 2025, fulfills his campaign promise of core tax cuts, comprising five main parts: corporate tax cuts, individual and family tax cuts, reduction of clean energy subsidies, cuts to Medicaid, and reductions in the Supplemental Nutrition Assistance Program (SNAP) [1][3]. Summary by Sections 1. Core Contents of the "Great Beautiful Act" - The act aims to make corporate and family tax cuts permanent, adhering to the Republican principle of a "small government" by cutting social welfare expenditures [3]. - Key components include: - Corporate tax incentives such as full depreciation on equipment and immediate deduction for R&D expenses, effective from 2025 [4]. - Permanent extension of lower personal income tax rates and an increase in standard deduction by $750 [5]. - Adjustments to state and local tax (SALT) deductions, raising the cap to $40,000 from 2025 to 2029, reverting to $10,000 in 2030 [6]. 2. Economic Stimulus Effects - The act is projected to increase the federal deficit by approximately $1.3 trillion over the next decade, with a deficit rate around 6% [11][14]. - It is estimated that the act will boost GDP growth by about 0.5 percentage points in 2026 and raise inflation by no more than 0.15 percentage points [11][12]. 3. Cuts to Clean Energy Subsidies - The act terminates several clean energy tax credits, including the $7,500 tax credit for electric vehicles, effective September 30, 2025 [7]. - It imposes stricter regulations on foreign entities involved in critical materials supply, enhancing national security in the energy sector [7]. 4. Medicaid Cuts - The act significantly tightens Medicaid eligibility, requiring able-bodied adults to complete at least 80 hours of work or community service monthly to maintain coverage [8]. - These reforms are expected to reduce federal spending by approximately $1 trillion over the next decade, potentially affecting 11.8 million individuals [8]. 5. SNAP Reductions - The act implements reforms to reduce SNAP expenditures, including increasing state responsibilities for administrative costs and adjusting benefit distribution mechanisms [9]. - It is projected to cut SNAP spending by about $186 billion over the next decade, impacting over 40 million beneficiaries [9]. 6. Increase in Debt Ceiling - The act raises the federal debt ceiling by $5 trillion, allowing for increased government borrowing [10].

Group 1 - The core viewpoint of the article emphasizes the need for a transformation and optimization of China's active fiscal policy after 17 years of implementation, highlighting its effectiveness in promoting economic stability, quality growth, and social welfare, while also addressing existing shortcomings and future directions for fiscal policy [2][3][4][5][6]. Group 2 - Active fiscal policy has effectively responded to external shocks, maintaining economic stability with an average growth rate of 9.9% from 2008 to 2010, compared to the global average of 1.7%, and a growth rate of 4.7% from 2020 to 2023, significantly higher than the global average of 2.3% [3][4]. - The policy has shifted focus towards technology innovation and green development, enhancing the potential for long-term high-quality economic growth [4]. - Social welfare has improved, with rural minimum living standards increasing by 73.3% and urban low-income standards by 45.4% from 2017 to 2023, while the share of public budget for social welfare rose from 35.1% in 2013 to 40.7% in 2023 [5]. Group 3 - Current fiscal policy faces challenges, including an overemphasis on short-term fiscal balance, which may hinder long-term economic stability and increase hidden government debt risks [8][9]. - The effectiveness of large-scale tax reductions is diminishing, with the macro tax burden decreasing to 16.3% of GDP in 2024, down 5.1 percentage points from 2013, which may threaten fiscal sustainability [12]. - The structure of fiscal spending needs optimization, as there is a tendency to focus more on supply-side and enterprise support rather than on demand and household needs [13][24]. Group 4 - Future fiscal policy should transition from a balanced approach to a functional one, allowing for a potential breach of the 3% deficit limit to better support economic stability and growth [16][17]. - Systematic responses to long-term challenges such as aging population and digital economy risks are necessary, including enhancing social security systems and adapting tax policies to new economic realities [18][20]. - The focus should shift from income policies to expenditure policies, emphasizing direct government spending to stimulate demand and support households [22][25]. Group 5 - The article suggests that the term "active fiscal policy" should be reconsidered to "expansionary fiscal policy" to better convey the intended signals to the market and stabilize expectations [26][27].