US corporations are set to claim roughly 16 billion US dollars in tax deductions this year for investments made before the July passage of the Republican tax law, according to an analysis by the Joint Committee on Taxation reported by The Washington Post.

The legislation, the One Big Beautiful Bill Act, reinstated a provision allowing firms to write off the full cost of certain new investments—including technology, equipment and facilities—in the first year of use. The measure had been part of the 2017 Trump tax law but was gradually phasing out and was due to expire in 2026.

Unlike previous iterations, the current provision applies retroactively, covering purchases placed into service from January 19. The JCT estimated that deductions over this five-month period will reduce federal revenue by 16 billion US dollars. Over the next decade, the 100 percent bonus depreciation is projected to cost 362.7 billion US dollars, with a 0.4 percent increase in GDP, according to the Tax Foundation.

Critics argue the retroactive element provides a windfall rather than an incentive. Senator Elizabeth Warren described it as a “blatant corporate handout,” while Steve Wamhoff of the Institute on Taxation and Economic Policy said retroactive deductions cannot influence past investment decisions.

Supporters contend the provision aligns tax policy with the true cost of business spending. Erica York of the Tax Foundation noted that traditional depreciation overstates profits and tax liability, while Senate Finance Committee Chairman Mike Crapo highlighted the measure, alongside other business tax breaks, as a driver of capital formation and growth.

Historically, the deduction has disproportionately benefited large firms. Between 2017 and 2022, C corporations claimed 2.7 trillion US dollars through upfront deductions, with companies earning over 1 billion US dollars accounting for more than 80 percent of the total.