The overhaul of the nation's tax system should boost the U.S. economy in the next couple of years, but the longer-term impact is questionable, Michelle Meyer, chief economist at Bank of America Merrill Lynch, told CNBC on Thursday.
The Republican tax bill, which was passed by Congress on Wednesday, is now awaiting President Donald Trump's signature. Among other things, it slashes the corporate rate to 21 percent from 35 percent.
BofAML believes the tax cuts will add about 0.3 percentage point in economic growth each of the next two years "or something close to that," Meyer said in an interview with "Power Lunch."
The bigger question, however, is whether those cuts will stimulate long-term growth, she noted.
"We're skeptical," Meyer said. "Are you actually going to see a transformation in the economy that gets us out of a slow-growth environment? ... I don't think that we're seeing legislation that gets us to that point."
For one, the individual tax cuts aren't the only change that is temporary. The provision that allows businesses to expense new investment purchases is set to be phased out after five years. That will lead to a higher effective tax rate for corporations, she said.
Republicans have touted their tax reform plan as a way to stimulate the economy. They say it will lead to business investment, hiring and wage growth.