How Harris' and Trump's tax and spending plans affect US debt
Adds budget graphic after sixth paragraph
By David Lawder
WASHINGTON, Sept 10 (Reuters) -Vice President Kamala Harris and Republican opponent Donald Trump have floated new tax breaks and spending plans, as they try to win votes by persuading Americans their ideas will do more to ease their financial burdens.
Budget forecasters are struggling to keep up with the latest tweaks, and new ideas may be voiced in Tuesday's Harris-Trump debate, but so far all estimates show Trump's agenda piling up much more new federal debt.
Trump has said he plans to extend all tax cuts he pushed through Congress in 2017, exempt Social Security and tip income from taxes, and further cut corporate income taxes.
These changes would likely add $3.6 trillion to $6.6 trillion to primary U.S. deficits over 10 years, according to published individual and comprehensive estimates from four budget forecasters reviewed by Reuters: the Penn-Wharton Budget Model, the Committee for a Responsible Federal Budget (CRFB), the Tax Foundation and Oxford Economics.
Harris' plans, which include expanding the Child Tax Credit, a $6,000 bonus tax credit for newborns, a $25,000 first-time homebuyer tax credit, and no taxes on tips, could reduce deficits by as much as $400 billion or add up to $1.4 trillion to deficits over a decade, the same forecasters calculated.
The estimates are based on static budget scoring, and are compared against the Congressional Budget Office's current-law "baseline," which already assumes a massive, $22 trillion increase in debt through 2034.
ROLLING ANALYSIS
The forecasts vary considerably depending on which ideas mentioned on the campaign trail are included.
Estimates of Harris’ recently rolled-out tax deduction of up to $50,000 for business startup costs, and a lower top capital gains tax than the one proposed by President Joe Biden are largely not included.
The forecasts include Trump’s proposal to lower the corporate income tax to 15% from 21% but not his latest comments that this rate would be reserved only for companies that produce their goods in the U.S.
"The campaign talking points are moving faster than the budget models," said Shai Akabas, economic policy director for the Bipartisan Policy Center. "I think we're largely seeing what we've come to expect in recent years, which is that candidates are going to put their popular policy priorities ahead of fiscal responsibility on both sides."
Congress must approve tax and spending legislation, making it difficult for the winner of the Nov. 5 election to achieve their priorities without sweeping majorities in both the Senate and the House of Representatives.
2025 TAX CLIFF
The major differentiator between Trump and Harris is how they address the 2025 expiration of individual tax cuts passed by Republicans during Trump's presidency in 2017. Without action by Congress, these rates would snap back to their previous, higher levels.
Trump has pledged to permanently extend all of the expiring tax cuts, including for the wealthiest Americans, which tax and budget experts estimate would reduce revenues over a decade by about $3.3 trillion to $4 trillion.
Harris would extend the 2017 tax cuts for only those earning under $400,000, keeping a Biden pledge, but this would add up to $2.5 trillion to a spending agenda already estimated at $2 trillion over a decade.
Harris has quietly endorsed the nearly $5 trillion in tax hikes in Biden's fiscal 2025 budget request, including taxing unrealized gains from fortunes over $100 billion and raising the corporate tax rate to 28%
This has caused consternation on Wall Street but would substantially offset the cost of her spending plans.
"I think the conclusion that Trump's approach to taxes is more debt-fueled is correct," said Steve Rosenthal, a senior fellow at the Urban-Brookings Tax Policy Center. "I say that because Harris at least has some pretty well-developed revenue raisers."
Trump has not offered any conventional tax increases to offset his extended tax cuts. Other breaks, including exempting Social Security income, would reduce revenue by $1.6 trillion, CRFB and the Tax Foundation estimate.
The conservative-leaning Tax Foundation called the move "unsound and fiscally irresponsible," weakening Social Security and Medicare.
Trump has said his tax cuts would be paid for with "trillions of dollars" generated by stronger economic growth, new import tariffs, ending Biden's clean energy subsidies and a new government efficiency commission headed by billionaire entrepreneur and Tesla TSLA.O CEO Elon Musk.
The Tax Policy Center has estimated that Trump's proposed 10% global tariff and 60% tariff on Chinese imports could raise up to $3.8 trillion over a decade but would reduce other revenues due to its economic effects, including imposing a de facto tax on households.
The Tax Foundation was the only model reviewed that included a tariff estimate as an offset -- $2.6 trillion -- but even then, it estimated that Trump's plans would boost deficits by nearly $4 trillion over a decade.
Comparing the budget impact of Trump's and Harris' tax and spending plans https://reut.rs/4e36B6D
Reporting by David Lawder; Editing by Heather Timmons and Jonathan Oatis
متعلقہ اثاثے
تازہ ترين خبريں
دستبرداری: XM Group کے ادارے ہماری آن لائن تجارت کی سہولت تک صرف عملدرآمد کی خدمت اور رسائی مہیا کرتے ہیں، کسی شخص کو ویب سائٹ پر یا اس کے ذریعے دستیاب کانٹینٹ کو دیکھنے اور/یا استعمال کرنے کی اجازت دیتا ہے، اس پر تبدیل یا توسیع کا ارادہ نہیں ہے ، اور نہ ہی یہ تبدیل ہوتا ہے یا اس پر وسعت کریں۔ اس طرح کی رسائی اور استعمال ہمیشہ مشروط ہوتا ہے: (i) شرائط و ضوابط؛ (ii) خطرہ انتباہات؛ اور (iii) مکمل دستبرداری۔ لہذا اس طرح کے مواد کو عام معلومات سے زیادہ کے طور پر فراہم کیا جاتا ہے۔ خاص طور پر، براہ کرم آگاہ رہیں کہ ہماری آن لائن تجارت کی سہولت کے مندرجات نہ تو کوئی درخواست ہے، اور نہ ہی فنانشل مارکیٹ میں کوئی لین دین داخل کرنے کی پیش کش ہے۔ کسی بھی فنانشل مارکیٹ میں تجارت میں آپ کے سرمائے کے لئے ایک خاص سطح کا خطرہ ہوتا ہے۔
ہماری آن لائن تجارتی سہولت پر شائع ہونے والے تمام مٹیریل کا مقصد صرف تعلیمی/معلوماتی مقاصد کے لئے ہے، اور اس میں شامل نہیں ہے — اور نہ ہی اسے فنانشل، سرمایہ کاری ٹیکس یا تجارتی مشورے اور سفارشات؛ یا ہماری تجارتی قیمتوں کا ریکارڈ؛ یا کسی بھی فنانشل انسٹرومنٹ میں لین دین کی پیشکش؛ یا اسکے لئے مانگ؛ یا غیر متنازعہ مالی تشہیرات پر مشتمل سمجھا جانا چاہئے۔
کوئی تھرڈ پارٹی کانٹینٹ، نیز XM کے ذریعہ تیار کردہ کانٹینٹ، جیسے: راۓ، خبریں، تحقیق، تجزیہ، قیمتیں اور دیگر معلومات یا اس ویب سائٹ پر مشتمل تھرڈ پارٹی کے سائٹس کے لنکس کو "جیسے ہے" کی بنیاد پر فراہم کیا جاتا ہے، عام مارکیٹ کی تفسیر کے طور پر، اور سرمایہ کاری کے مشورے کو تشکیل نہ دیں۔ اس حد تک کہ کسی بھی کانٹینٹ کو سرمایہ کاری کی تحقیقات کے طور پر سمجھا جاتا ہے، آپ کو نوٹ کرنا اور قبول کرنا ہوگا کہ یہ کانٹینٹ سرمایہ کاری کی تحقیق کی آزادی کو فروغ دینے کے لئے ڈیزائن کردہ قانونی تقاضوں کے مطابق نہیں ہے اور تیار نہیں کیا گیا ہے، اسی طرح، اس پر غور کیا جائے گا بطور متعلقہ قوانین اور ضوابط کے تحت مارکیٹنگ مواصلات۔ براہ کرم یقینی بنائیں کہ آپ غیر آزاد سرمایہ کاری سے متعلق ہماری اطلاع کو پڑھ اور سمجھ چکے ہیں۔ مذکورہ بالا معلومات کے بارے میں تحقیق اور رسک وارننگ ، جس تک رسائی یہاں حاصل کی جا سکتی ہے۔
