Trump’s Budget May Give Private Equity a Giant Tax Break
Lawmakers have inserted a line into Donald Trump’s new budget bill that would reward Wall Street firms with billions of dollars in new tax breaks when they load up companies with debt and proceed with pay cuts, factory closures, and layoffs.

President Donald Trump delivers remarks before signing a series of bills related to California’s vehicle emissions standards during an event in the East Room of the White House on June 12, 2025, in Washington, DC. (Chip Somodevilla / Getty Images)
Congressional lawmakers have inserted a line into President Donald Trump’s new tax bill that would reward Wall Street firms with billions of dollars of new tax breaks when they load up companies with debt and proceed with worker pay cuts, factory closures, and mass layoffs, according to bill text reviewed by the Lever.
The new bipartisan provision is the culmination of a multimillion-dollar lobbying campaign by private equity giants, whose executives have been among the biggest supporters of Trump and the lawmakers behind the legislation.
The provision, which uses the tax code to effectively subsidize Wall Street firms’ takeovers of small- and medium-sized businesses, follows a landmark study demonstrating that employment quickly shrinks at companies when they are purchased by private equity firms. It also follows new data showing a record number of private equity–owned companies are being driven into bankruptcy.