The estimate from the Penn Wharton Budget Model analyzes several of Trump’s economic proposals, including extending key provisions in the 2017 tax reform bill, eliminating taxes on Social Security benefits and reducing the corporate income tax rate.
Analysts estimated the slate of proposals would add a net $5.8 trillion to primary deficits “on a conventional basis” from 2025 to 2034, compared to $4.1 trillion on a dynamic basis, when accounting for “economic feedback effects.”
In a cost breakdown of the basket of proposals, extending expiring individual income tax provisions from the 2017 legislation had the largest price tag.
Analysis estimating the effort could “add $3.4 trillion to deficits (before interest costs) over the next ten years.”
“Restoring the original TCJA regime for taxing business investment adds another $623 billion to increase the total cost of TCJA extension to more than $4 trillion,” the analysis stated.
The cost of doing away with taxes on Social Security benefits could be as high as $1.2 trillion over a 10-year period, the analysis also projects, while reducing the corporate tax rate to 15 percent could cost $595 billion over the same time frame.
“Low, middle, and high-income households in 2026 and 2034 all fare better under the campaign proposals on a conventional basis,” the analysis stated, though it added that “these conventional gains and losses do not include the additional debt burden on future generations who must finance almost the entirety of the tax decreases.”
The Hill’s Aris Foley has more here.
