Can President Trump and the Republican Party Shift Voter Sentiment Before November 2026?
In July 2025, President Donald Trump signed the One Big Beautiful Bill Act (OBBBA, H.R. 1) into law, which could be described as the centerpiece of Republican efforts to address the cost-of-living crisis ahead of the 2026 midterms.
Therefore, before we discuss the measures being implemented or considered by the Trump administration and the Republican Party in 2026, to shift voter sentiment before November, we must take a look at the impact of the OBBBA legislation implemented in 2025 and its impact so far on the American public.
The sweeping reconciliation package permanently extended the lower individual tax rates introduced by the 2017 Tax Cuts and Jobs Act and doubled the standard deduction, while also introducing additional relief such as eliminating taxes on qualified tips and overtime pay, providing a $6,000 deduction for seniors, and expanding both the Child Tax Credit and dependent care benefits.
It also broadened the Health Savings Accounts primarily by widening eligibility and increasing flexibility in how they can be used. Individuals enrolled in a broader range of health insurance plans, particularly lower-cost ones, became newly eligible to open and contribute to HSAs, bringing millions more people into the system. Also, the rules governing qualified medical expenses were relaxed, allowing funds to be used for services like telehealth and certain subscription-based primary care arrangements without losing tax advantages.
At the same time, however, the law also tightened eligibility for Affordable Care Act (ACA) premium tax credits, which function as subsidies to reduce monthly health insurance costs. By narrowing income thresholds and revising qualification criteria, fewer individuals now meet the requirements for these subsidies, and some who still qualify receive reduced benefits.
As of early April 2026, the US Internal Revenue Service (IRS) had returned over US$ 240 billion in refunds to more than 100 million Americans, amounting to roughly 70% of filers, which goes to show the broad reach of the tax changes across the population.
The average refund rose to around $3,500, an increase of roughly 10–11% year-over-year, translating to about US$ 300–350 more per taxpayer on average, which is a modest but noticeable gain in take-home income.
Also, according to an unnamed US Treasury official, around 53 million taxpayers actively claimed provisions introduced under the new law, indicating that a substantial share of filers did not just passively benefit from lower rates but directly engaged with specific tax relief measures. This suggests that the law’s impact extended beyond broad-based cuts, with tens of millions of Americans consciously utilizing targeted provisions to reduce their tax liability.
That said, the aforesaid surge in refunds was driven in part by the interaction between newly enacted tax cuts and existing withholding systems, which did not immediately adjust to lower tax liabilities. Therefore, it is important to bear in mind that many taxpayers effectively overpaid throughout the year and received the difference back as lump-sum refunds during the filing season.
Also, to offset the roughly US$ 4.5 trillion in tax cuts, the Trump administration tightened eligibility for Affordable Care Act (ACA) premium tax credits and allowed enhanced ACA subsidies to expire at the end of 2025, trimmed Medicaid and SNAP funding, and repealed or restricted clean-energy tax credits from the Inflation Reduction Act.
So, even if the aforesaid refunds may have delivered immediate pocketbook relief, they may have done so in return for broader cost increases because the Congressional Budget Office and groups like the Center on Budget and Policy Priorities project that Medicaid and ACA changes could leave 10–15 million more Americans uninsured by the mid-2030s, driving up premiums for millions as enhanced subsidies lapse.
Moreover, the slashing of clean-energy incentives is also estimated to raise average household energy bills by around US$ 280 yearly by 2035.
So, overall, the OBBBA puts more cash in people’s hands via lower tax rates and higher standard deductions, but reduces government help in healthcare, food, and energy, thereby increasing the out-of-pocket expenses.
This puts the lower-income individuals or households at a disadvantage because tax benefits scale with income, meaning the biggest financial gains go to higher-income households, while the lower-income section of the population is left to manage with smaller direct tax benefits and reduced federal support in the face of rising living expenses.
One must also take into account the tariffs imposed on imports by the Trump administration, which have added to the costs for groceries, clothing, cars, and housing materials.
And, now with the conflict in the Middle East, fuel prices have also soared, which must be cutting into most of the tax refunds of lower-income people who spend more of their pay on gasoline.
As noted earlier, the average tax refund for the 2025 tax year rose by roughly US$ 300–350, while the economists at the Stanford Institute for Economic Policy Research estimate that conflict-driven price increases have added about US$ 857 to Americans’ average annual gasoline expenses this year.
Trump Administration’s 2026 Affordability Agenda: Housing, Energy, Drug Prices and Credit
The 2025 reconciliation package from the Trump administration emphasized tax relief aimed at boosting take-home pay and supporting consumer spending, which aimed to address the demand-side pressures amid broader economic headwinds in the United States.
In 2026, the Trump administration appears to be shifting focus toward supply-side factors, with measures targeting housing availability, energy independence, healthcare pricing, and credit access, in an effort to ease structural cost pressures and improve overall affordability for households.
Housing
On January 20th, President Trump signed an Executive Order (EO), directing the federal agencies to curb support for large institutional buying of single-family homes by limiting access to government-backed financing channels and prioritizing owner-occupiers in federal housing programs. It also calls for increased regulatory scrutiny of bulk acquisitions, tasks agencies with defining and monitoring large investors, and urges the U.S. Congress to codify these measures into law.
Alongside this EO, the Trump administration also directed Fannie Mae and Freddie Mac to purchase up to US$ 200 billion in mortgage-backed securities to help lower borrowing costs, as part of a broader push to ease housing affordability.
On March 12th, the U.S. Senate passed the largest piece of housing legislation in 36 years with overwhelming bipartisan support. Called the ‘21st Century ROAD to Housing Act’, it aims to expand housing supply and improve affordability by streamlining federal environmental reviews, reducing regulatory barriers to construction, and modernizing rules for manufactured and factory-built housing.
It seeks to broaden the legal definition of manufactured housing by removing the requirement for a permanent steel chassis, and updates mortgage lending standards to enable such homes to qualify for traditional, lower-cost financing, expanding credit access, and supporting faster, more scalable housing supply.
The legislation also increases federal support for development through higher loan limits and expanded grant programs, encourages redevelopment of vacant and aging properties, and unlocks private capital while preserving local zoning authority.
It also seeks to curb bulk acquisitions of single-family homes by large institutional investors, while using federal incentives and restrictions to discourage further accumulation, alongside updates to housing programs and financing channels aimed at expanding access to homeownership.
It also includes provisions to expand mortgage access, support smaller lenders and modernize underwriting and appraisal processes to lower borrowing costs and widen access to homeownership.
President Trump also supports the legislation and issued two EOs on March 13th, one aimed at cutting regulatory hurdles to housing construction and another focused on loosening mortgage credit rules for smaller banks.
Specifically, the EO related to regulatory barriers directed the Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers to streamline permitting and review environmental, energy, and water-efficiency rules seen as constraining housing construction.
While the one related to mortgage credit rules urged regulators to ease mortgage lending standards for community and smaller banks, including capital, appraisal, and underwriting requirements, to expand credit access and lower borrowing costs.
However, the prospects of the 21st Century ROAD to Housing Act remain uncertain as it moves to the House, where lawmakers from both parties have policy disagreements with their counterparts in the Senate.
Moreover, President Trump himself, despite indicating support to the legislation and having issued EOs with similar provisions as the legislation, has cast considerable doubt in recent days on its chances of enactment by having said that he will withhold signing of any legislation until Congress passes stricter election rules—such as tighter voter eligibility and registration requirements—that remain stalled in the Senate, leaving divided Republicans with little incentive to coalesce around the proposal.
That said, even if the Regulatory EOs are fully implemented, it could accelerate permitting and supply, though the impact would be gradual. Borrowing conditions could improve within months, but any meaningful relief on prices and rents would take longer to materialize.
While the limits on institutional investors – who own roughly 1–4% of single-family homes – and mortgage-backed securities purchases are expected to have only a modest effect on overall housing costs.
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