In a perilous economic and fiscal environment, with instability created by Trump’s trade war and publicly held debt on track to surpass the highest levels ever recorded within five years, a lot rides on how Republicans navigate tax and spending reforms in reconciliation.
6 min read
Permanently extending the Tax Cuts and Jobs Act would boost long-run economic output by 1.1 percent, the capital stock by 0.7 percent, wages by 0.5 percent, and hours worked by 847,000 full-time equivalent jobs.
6 min read
As Republicans look for ways to offset the budgetary cost of extending the expiring provisions of the Tax Cuts and Jobs Act (TCJA) and potentially enacting other tax cuts, the latest estimates indicate several trillion dollars could be raised by reducing tax credits and other preferences in the tax code.
5 min read
Fiscal pressures are likely to weigh heavily on lawmakers as they craft a tax reform package. That increased pressure could result in well-designed tax reform that prioritizes economic growth, simplicity, and stability, or it could encourage budget gimmicks and economically harmful offsets. Lawmakers should avoid the latter.
8 min read
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
We estimate Trump’s proposed tariffs and partial retaliation from all trading partners would together offset more than two-thirds of the long-run economic benefit of his proposed tax cuts.
12 min read
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
Not every change in the Tax Cuts and Jobs Act simplified the tax code. However, the TCJA reduced compliance costs overall for individual filers, and allowing fundamental structural improvements to expire would make the tax code worse.
5 min read
Policymakers should have two priorities in the upcoming economic policy debates: a larger economy and fiscal responsibility. Principled, pro-growth tax policy can help accomplish both.
21 min read
At the end of 2025, the individual tax provisions in the Tax Cuts and Jobs Act (TCJA) expire all at once. Without congressional action, most taxpayers will see a notable tax increase relative to current policy in 2026.
4 min read
The TCJA improved the U.S. tax code, but the meandering voyage of its passing and the compromises made to get it into law show the challenges of the legislative process.
6 min read
From a revenue standpoint, about $9 billion of the $11.7 billion in lost revenue would accrue to joint filers earning more than $200,000.
5 min read
The fate of the $10,000 cap on state and local tax (SALT) deductions remains uncertain, with some policymakers pushing for an increase or repeal of the cap before its scheduled expiration in 2026.
6 min read
Policymakers on Capitol Hill should prioritize permanent pro-growth policy in the coming years as the economy struggles with inflation and the recovery from the pandemic.
4 min read
Any move to repeal the cap or enhance the deduction would disproportionately benefit higher earners, making the tax code more regressive.
5 min read
By extending bonus depreciation and introducing neutral cost recovery, the RSC budget would significantly improve the treatment of investment leading to increased growth, expanded employment, and higher wages.
3 min read
As we near this year’s “lame duck” session of Congress, there has been renewed interest in reforming the child tax credit as part of a tax deal. Our new analysis highlights the trade-offs that policymakers will face
5 min read
The United States needs to grow its way out of inflation and set the economy up for continued growth—the tax code provides tools for policymakers to do just that.
3 min read
By reducing the tax code’s current barriers to investment and saving and simplifying its complex rules, lawmakers would greatly enhance the ability of Americans to pursue new ideas, create more opportunities, and build financial security for themselves and their families.
40 min read
Policymakers and taxpayers should understand the scope of tax changes necessary to fully pay for the large-scale social spending programs that would be initiated under the Build Back Better Act.
6 min read