A tax cut package Obama unveiled in February 2016 that includes a big chunk of his tax cuts would actually raise taxes by about $1.5 trillion in 2017, according to the nonpartisan Tax Policy Center.
That would leave the U.N. with a deficit of about $3.4 trillion.
The problem is that that estimate doesn’t include the costs of the tax cuts that would be phased in over time, and the bill would not be revenue neutral.
That means the bill could have a large effect on the deficit.
The Tax Policy center estimates that the tax cut would reduce the deficit by about 3 percent of GDP.
The tax cuts themselves add about $500 billion to the national debt, and $300 billion of that comes from the payroll tax cut that is set to expire at the end of 2021.
A tax-cut package that includes those payroll tax cuts and other revenue neutral cuts would end up raising the debt by about a third of GDP, the center found.
The biggest impact of the Tax Policy centers estimate is that the $1 trillion cost of the payroll taxes would be offset by about another $300 million or so from the revenue neutral payroll tax reductions that Obama unveiled.
In other words, the $500 trillion in debt Obama announced in February would be erased by the payroll revenue neutral tax cuts.
The fact that this is a problem that Obama will have to address in his final budget proposal is a big problem, but it’s not as big as it seems.
Here’s what the Tax Policies Center’s Jason Furman said: The bigger problem is the fact that the payrolls tax cuts, in this scenario, would not increase GDP by enough to offset the revenue neutrality effects of the corporate income tax cuts — in fact, they would be more offset by the revenue loss from the cuts in corporate taxes.
And so, in fact the tax reductions would not make up for any of the spending reductions.
The big question is: how much revenue is going to come from that payroll tax reduction?
And the answer is: very little.
The Congressional Budget Office projects that the revenue losses from the corporate tax cuts in this plan would add just 0.2 percent to GDP in 2021.
That’s roughly what would be needed to close the budget gap.
But if we look at the tax changes that Obama announced, we see that there is very little revenue lost, so there’s not much to offset.
There is a lot of tax reduction for the rich The biggest beneficiaries of the $250 billion in tax cuts are those with high incomes.
According to the Tax Foundation, people earning more than $500,000 would see their taxes rise by $100,000.
That leaves them with a $150 billion deficit in 2017.
Even more astounding is that this $150 bill would raise revenue for only one of the three federal agencies that benefit from the tax breaks.
The Social Security Trust Fund, the federal government’s trust fund, would actually shrink by $10 billion in 2017 from what it is today.
But because of a payroll tax increase, the Social Security trust fund will actually shrink more than the $25 billion deficit that the Trump administration has forecast.
That shortfall would shrink to $12.5 billion by 2021 from $14.4 billion.
This would put the Social Safety Net at a $20 billion deficit by 2021.
And the Social Protection Trust Fund would shrink even more.
The SSA and Social Security Administration would see $8 billion less in revenue in 2017 under the $750 billion in cuts to the tax relief package.
The savings that the President and Republicans have made over the years on the tax code would be wiped out by these tax cuts on top of the budget cuts that will be made in 2018.
In a press conference on January 16, 2021, President Donald Trump promised to cut taxes for everyone.
But he also promised to raise taxes on the rich.
The president said, “We are going to cut our rates, we are going not to increase them, we’re going to have to have a bigger deficit.”
But his tax plan is an attempt to make up that deficit by raising taxes on a large number of Americans.
This will only exacerbate the budget problems that the president is already facing.
What do you think?
Is the Trump tax plan a mistake?
Do you think it’s going to lead to more deficit and debt in the years ahead?
Let us know in the comments below.