A handheld sign saying One Big Beautiful Bill at the Senate voting. (Photo/CCTV)

Chongqing - On July 4, President Trump signed the One Big Beautiful Bill (OBBB) into law—a sweeping Republican-led package that cuts social programs, overhauls tax policy, and heightens global clean energy tensions, especially with China.

"Make America Win Again?"

Democrats have strongly criticized the OBBB for cutting key social programs like healthcare while boosting federal spending and expanding tax breaks for businesses and property owners. The Congressional Budget Office estimates the bill could leave up to 11.8 million people without health insurance by 2034, mainly due to reduced Medicaid and ACA subsidies. It also raises the estate tax exemption to $15 million, enabling greater intergenerational wealth transfer for the rich.

While cutting public health programs, OBBB allocates substantial funding increases to federal law enforcement, including the hiring of 10,000 new ICE personnel, 5,000 customs officers, and 3,000 Border Patrol agents. These institutions remain central to current protests over Trump-era immigration crackdowns.

Republican ranks are also divided. Once a close ally of Trump but now publicly estranged, Elon Musk openly criticised the OBBB as “insane.” The OBBB's projected $3.3 trillion increase to the federal deficit has alarmed many GOP lawmakers and remains a key point of division within the party—especially as the figure continues to grow with each revision. Adding to concerns is the bill’s $5 trillion debt ceiling hike, exposing a rift between Republican spending policies and their fiscal restraint messaging.

Besides the OBBB’s sweeping domestic reforms, its extensive tax policy and spending changes have international ramifications and an outright retaliatory plan. A proposed Section 899 initially sought to raise taxes on foreign entities from countries imposing “unfair” taxes on U.S. businesses, targeting measures like Europe’s Digital Services Taxes. However, the provision was dropped in the final bill after diplomatic negotiations.

Canadian PM Carney meets Trump. (Photo/CCTV)

On June 27, President Trump suddenly halted trade talks with Canada, calling its 3% digital services tax on U.S. tech firms discriminatory—even though it may not technically violate the bill’s rules. Canada quickly backed down to resume negotiations. 

This incident foreshadows how the OBBB could work: the U.S. not only reacts to foreign tax policies but positions itself—often unilaterally—as the global judge of what’s fiscally fair. The bill’s approach is summed up in Subtitle C’s name: “Make America Win Again.”

OBBB systemically targets China and Chinese business

Subtitle C of the OBBB (Sections 112001–112016) calls for ending or phasing out key clean energy tax credits—including those for electric vehicles, energy efficiency, clean power, hydrogen, and carbon capture—across commercial and residential sectors. 

This marks a sharp break from Biden-era policies under the Inflation Reduction Act. Framing clean energy as a geopolitical contest with China, the Trump administration has labeled such efforts a “Green New Scam,” positioning Beijing as a national security threat.

OBBB unmistakably conducts economic exclusion, which has serious implications for China and Chinese businesses. Although the OBBB makes no explicit mention of China, it invokes an external designation of China as a "Covered Nation," alongside Russia, Iran, and North Korea. This indirect reference provides the legal basis for broad exclusions targeting Chinese firms, personnel, and those affected by their relations with China.

Under the OBBB framework, if excluded, Chinese firms or related-affected entities are barred from accessing clean energy tax credits or may only qualify if they meet narrowly defined construction or operation deadlines. With multiple short eligibility windows for investment, construction, or facility operation, layered credit exclusion generates regulatory uncertainty and thus drives up financing costs, especially for firms with cross-border supply chains.

Chinese actors may want to strategise preemptively. However, the political left in the U.S. realises that the OBBB also delivers a devastating blow to the emergent American green sector.

U.S. green sector faces fallout from China supply cuts

The OBBB could hurt U.S. green sector businesses, which rely heavily on Chinese supply chains. China produces over half of the world’s green tech components, with clean tech exports projected to surpass $340 billion by 2035. Decades of industrial policy have made companies like CATL, Goldwind, Longi, and BYD global leaders. In the U.S., Chinese-made stationary batteries remain essential to the power sector.

With the trade war already undermining this interdependence, and now the OBBB layering on regulatory penalties, entire industries stand exposed to sudden policy and market shocks. The bill punishes companies with Chinese ties across multiple domains: personnel, materials, technology, and financing. OBBB's language is broad, and enforcement could reach across ambiguous thresholds. 

In the short term, Chinese and U.S. businesses—as well as American consumers—may rush to launch or fund clean energy projects before tax credits expire. But the OBBB’s impact will soon hit the industry, where even a basic rooftop solar installation can take months. Chinese firms may use this brief window to boost sales or restructure operations, but will proceed cautiously amid complex and unclear compliance rules.

In 2024, China accounted for 47% of all green energy exports—including electric vehicles, batteries, solar panels, and wind equipment—to the Global South. While the European Union moves to reduce dependence on Chinese supply chains citing energy security concerns, structural reliance on Chinese technologies remains significant. The future of global energy is increasingly shaped by geopolitical competition as well as industrial capacity.