CBO and JCT Preview Economic Analysis of Extending TCJA
The analysis provides key insights into how their models work and the sort of outputs we can expect from their models as part of next year’s tax debate.
8 min read
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All About That Base(line)
If lawmakers are serious about pro-growth policies and fiscal responsibility, they will need to put policies forward that achieve those goals. Simply adjusting the baseline doesn’t reduce actual deficits in the coming years.
7 min read
How 2026 Tax Brackets Would Change if the TCJA Expires
If Congress allows the Tax Cuts and Jobs Act (TCJA) to expire as scheduled, most aspects of the individual income tax would undergo substantial changes, resulting in more than 62 percent of tax filers experiencing tax increases in 2026.
3 min read
Federal Fiscal System Is Very Progressive—and Getting More So—Latest CBO Report Shows (2024 Update)
CBO data shows that the federal fiscal system—both taxes and direct federal benefits—is getting more progressive and redistributive in 2024.
7 min read
10 Less Harmful Ways of Raising Federal Revenues
If lawmakers are convinced that new revenues must be part of any long-term effort to solve the budget crisis or offset the cost of extending the TCJA, they must choose the least harmful ways of raising new revenues or else risk undermining their efforts by slowing economic growth.
7 min read
White House Right on Importance of Business Investment, Wrong on Relevant Policy
The Treasury Department recently touted strong business investment in the years following the pandemic-driven recession and pointed to the Biden administration’s industrial policies in the Inflation Reduction Act and CHIPS Act as key drivers.
7 min read
How Have Federal Revenues Evolved since the Tax Cuts and Jobs Act?
As members of Congress prepare to address the expiration of the TCJA, they should appreciate how revenues have evolved since 2017.
4 min read
Latest CBO Projections Highlight Fiscal Challenge of Full TCJA Extension
While neither full expiration nor a deficit-financed full extension of the TCJA would be appropriate, lawmakers should consider the incentive effects of whichever tax reform they pursue. Because taxes affect the economy, they also affect the sustainability of debt reduction.
3 min read
Sustainably Reforming Social Security and Medicare Will Need More than Just Tax Hikes
Creative options including changes in Social Security benefits growth for higher earners and reforms to how Medicare compensates for health services should be on the table, along with broad-based and well-structured tax reforms.
6 min read
Major Takeaways from CBO’s Updated Long-Term Outlook
The CBO projects deficits will be higher than historical levels, largely due to growth in mandatory spending programs While some recent legislation has reduced the deficit, the Inflation Reduction Act is proving to be more expensive than originally promised.
5 min read
IRS Report Shows Closing the Tax Gap Would Not Close the Deficit
The latest tax gap report from the IRS has generated much media attention—and much misunderstanding.
6 min read
Federal Deficit Grew to $2 Trillion in FY 2023
Outside of the pandemic years, this year’s federal deficit is the highest in U.S. history. While tax revenue has increased about 28 percent since the pre-pandemic year 2019, spending has increased about 46 percent. Annual deficits are headed towards $3 trillion over the next few years.
3 min read
How to Rein in the National Debt
Now is the time for lawmakers to focus on long-term fiscal sustainability, as further delay will only make an eventual fiscal reckoning that much harder and more painful. Congressional leaders should follow through on convening a fiscal commission to deal with the long-term budgetary challenges facing the country.
35 min read
Repealing Inflation Reduction Act’s Energy Credits Would Raise $663 Billion, JCT Projects
The price tag of the Inflation Reduction Act’s green energy tax credits is much higher than originally thought. Among other things, the updated analysis indicates the Inflation Reduction Act does not reduce deficits after all.
6 min read
Tackling America’s Debt and Deficit Crisis Requires Social Security and Medicare Reform
Any serious proposal to tackle the emerging debt and deficit crisis must also address our largest mandatory spending programs: Social Security and Medicare. Together, these two programs will be responsible for nearly 80 percent of the deficit’s rise between 2023 and 2032, according to Congressional Budget Office (CBO) projections.
8 min read
Design Matters When Raising Taxes to Reduce the Deficit and Stabilize the Debt
Rather than continue down the path of growing debt, lawmakers should craft a comprehensive solution. International experience cautions against tax-based fiscal consolidations, but modest tax increases may be part of a successful debt reduction package.
6 min read
How America’s Debt Problem Compares to Other Countries—and Why It Matters
According to the International Monetary Fund (IMF), the U.S. federal government is among the most indebted governments in the world.
6 min read
Fast Approaching Debt Limit Deadline and Growing Debt Demand Action
As policymakers look to tackle America’s debt and deficit crisis, they should consider international experiences on successful fiscal consolidations.
6 min read
Deteriorating Federal Budget to Run $1.4 Trillion Deficit in 2023, CBO Projects
Immediately balancing the $20 trillion budget shortfall would take drastic, unwanted policy changes. Instead, lawmakers should target a more achievable goal, such as stabilizing debt and deficits with an eye toward comprehensive tax reform that can produce sufficient revenue with minimal economic harm.
4 min read
CBO Analysis Finds Income Growth and Progressive Tax Code in 2019
Newly published data from the CBO indicates in 2019, before the onset of the pandemic, American incomes continued to rise as part of a broad economic expansion. It also shows that, contrary to common perceptions, the federal tax system is progressive.
4 min read