Did the OBBB Affect Firms' Plans for 2026?
April 13, 2026
Around 20 percent of respondent firms in the Atlanta Fed's Business Inflation Expectations (BIE) survey told us that they consider the One Big Beautiful Bill (OBBB) in their decision making and short-term planning. The remaining firms said they did not factor in the OBBB when planning for outcomes such as capital expenditures, employment, and sales revenue forecasts. These results may be a reflection of the fact that many of the provisions of the law were already in place and with the passage of OBBB are now extended or made permanent (such as provisions of the 100 percent bonus depreciation and the 20 percent deduction for qualified business income). Our findings suggest that a broad-based and sizeable future surge in business activity stemming from the policy change may not be likely.
Provisions in the OBBB and the CBO's estimated impact
The OBBB passed Congress and was signed into law in July 2025. Many of the provisions in the law are intended to benefit business owners and firms by extending or making permanent provisions from the Tax Cuts and Jobs Act (TCJA). Three important provisions that benefit US firms are:
- Permanent 100 percent bonus depreciation, which can lead to reduced taxes and improved cash flow for firms;
- Immediate expensing of domestic R&D costs, which accelerates the previous amortization schedule set by the TCJA; and
- Permanent 20 percent qualified business income deduction for pass-through firms. This allows self-employed and pass-through entity owners to reduce taxable income.
The Congressional Budget Office (CBO) provides nonpartisan analysis of bills passed by Congress. Overall, the CBO estimates find that the OBBB will increase real GDP by 0.5 percent, on average, over the 2025–34 period, relative to the January 2025 baseline. The impact mostly comes through extensions of TCJA policies and new tax cuts.
Our surveys reported minimal impact from the TCJA on firms
As the OBBB is an extension of the TCJA in many ways, it is instructive to review survey results on how firms reacted to the potential impacts of the TCJA when the law was being debated in late 2017. In November 2017, the BIE asked firms about how the TCJA would affect expected hiring plans for 2018. Roughly two-thirds of respondent firms indicated that the tax reform did not cause them to change their hiring plans for the upcoming year. In addition, at the same time, another monthly Atlanta Fed business survey, the Survey of Business Uncertainty, asked about how the TCJA would affect firms' planned capital expenditures for 2018. Again, about two-thirds of firms said that the TJCA would cause no material change to capital expenditures.
To get a better measure of how the TCJA affected future plans, in February 2018 the BIE asked similar questions, but about plans for 2019 capital investment. This time, three-quarters of firms said that the TCJA caused no material change to capital expenditure plans. During the period from November 2017 through February 2018, as business decision makers were able to better digest TCJA's details, their views remained largely unchanged. However, even if firms did not respond to TCJA, this does not imply the policy was ineffective. A major component of both the TCJA and the OBBB is individual tax cuts, which can stimulate aggregate demand.
Our surveys report that the OBBB has minimal impact on firms
Based on our earlier experiences, in February 2026 we asked the BIE respondents the following OBBB-related questions. First, we presented the respondents with a short preamble describing the OBBB and a few of its key provisions. Next, we asked how the OBBB affects three outcomes of the firm's decision making for 2026 regarding planned capital investment, expected number of employees, and sales revenue forecasts. For each key outcome, firms were able to respond that the OBBB caused the outcome to be higher, lower, or about the same. In addition, the survey offered firms a fourth response option: they could indicate that the OBBB did not factor into the firm's decision-making process for that key outcome.
In response to the question "How does the OBBB impact your firm's planned levels of capital investment for 2026?", figure 1 shows that just 17 percent of firms increased planned capital investment for 2026 as a result of the OBBB. Indeed, 78 percent of firms either did not consider the OBBB when making capital investment plans for 2026, or they responded that the OBBB will result in their capital investment being about the same.
Digging deeper into how firms consider the OBBB when planning capital investment, we can see a similar result across several sectors. Figure 2 shows that between 74 and 83 percent of respondent firms in construction, manufacturing, retail, financial, and other sectors told us that either the OBBB did not play a role in their capital investment planning or they did not expect OBBB to make a difference.
Additionally, the BIE survey asked firms "How does the OBBB impact your firm's expected number of employees by the end of 2026?" and "How does the OBBB impact your firm's sales revenue forecasts for 2026?" The results are similar to the question about capital expenditure. On employee levels and sales revenue forecasts, 88 percent and 76 percent of firms, respectively, said that the OBBB either did not factor into their planning or that it would have little to no impact on those outcomes.
When firms did consider OBBB as part of their planning process, the impact of OBBB on the three outcomes was small. The table shows that, on average, OBBB has only a small net positive impact on expected employment levels, planned capital investment, and sales revenue forecasts for 2026.
Eight years ago, three-quarters of respondent firms told us that the TCJA did not play a role in their plans for 2018 and 2019. Firms did not expect it to play a meaningful role in their hiring plans or capital expenditure planning. Similarly in 2026, most firms feel the same about the OBBB. Anywhere between 76 percent and 88 percent of respondent firms tell us that the OBBB either will have no impact—or that they didn't even consider the OBBB when making capital expenditure plans, employment plans, or sales revenue forecasts for 2026.
Said another way, although some of the provisions in the OBBB—such as tax changes regarding expensing, deductions, and depreciation—might provide a tailwind for growth during the coming year, business execs aren't yet forecasting much of a direct boost to their own-firm prospects this year.