Deficit Woes: The Impact of Trump's Tax Cuts
The U.S. Congressional Budget Office projected a $2.8 trillion deficit increase over a decade due to President Trump's tax-cut and spending bill, despite enhanced economic output. The bill could raise the federal debt by $5 trillion when factoring interest payments and permanent tax breaks proposed by the Senate.
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The U.S. Congressional Budget Office has announced that President Donald Trump's ambitious tax-cut and spending bill could increase the deficit by $2.8 trillion over the next decade. This comes in spite of the anticipated boost in economic output driven by these legislative measures.
Released on Tuesday, the nonpartisan agency's dynamic analysis of the fiscal plan—passed by the House of Representatives in May—coincides with Senate Republicans examining a revised iteration.
Two weeks ago, the CBO forecast that the One Big Beautiful Bill Act might escalate the federal debt by $2.4 trillion over ten years, excluding possible economic impacts. With additional interest expenses, the overall cost could surge to $3 trillion. Analysts warn the Senate's version, which solidifies several business tax perks, may push the debt increase up to $5 trillion.
(With inputs from agencies.)
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