Tax Foundation: Senate reform bill would cost $516B
An analysis by the right-leaning Tax Foundation released Friday reports that the Senate GOP’s tax-reform plan would cost $516 billion once economic growth was taken into account.
“The Senate’s version of the Tax Cuts and Jobs Act is a pro-growth tax plan, which, when fully implemented, would spur an additional $1.26 trillion in federal revenues from economic growth,” the analysis said. Compared with the “static” score of $1.78 trillion in revenue losses before economic growth were taken into account, that would leave a total of $516 billion in higher deficits.
The lost revenue has been a key sticking point, with key Republicans such as Sen. Bob Corker (Tenn.) vowing to vote against any tax-reform legislation that raises the deficit.
Analyses of the House version of the bill found that even with economic growth, it would still add between $1 trillion to $2 trillion in deficit spending over the course of a decade. The Tax Foundation’s analysis of the House bill’s effects fell on the high end of the growth spectrum, finding that it would produce $1 trillion in extra revenues on $1.9 trillion of losses, thus leaving some $989 billion in overall deficit spending.
In its new analysis of the Senate bill, the Tax Foundation found that overall gross domestic product would be 3.7 percent higher by the end of a decade, that wages would be 2.9 percent higher and that the economy would add an equivalent of 925,000 full-time jobs.
“Depending on the baseline used to score the plan, current policy or current law, the new revenues could bring the plan closer to revenue neutral,” the Foundation analysis said.