CNN
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House Republicans’ sweeping tax and spending cuts package would increase the deficit by $2.4 trillion over the next decade, according to the Congressional Budget Office’s analysis of the bill that GOP lawmakers narrowly approved last month.
The highly anticipated score, which was released Wednesday, could complicate Senate Majority Leader John Thune’s task of crafting a version of the legislation that his divided conference would approve. Several GOP senators have already expressed concern about the House package’s potential impact to the deficit and want to make deeper spending cuts, while others are wary of the major reductions to the nation’s safety net – particularly Medicaid – in the House bill.
The analysis also adds ammunition to billionaire Elon Musk’s attacks on the package, which he wrote on X Tuesday would bankrupt America. The posts follow an interview with CBS Sunday Morning, in which Musk said will increase the deficit and undermine the work of his Department of Government Efficiency.
“I’m sorry, but I just can’t stand it anymore. This massive, outrageous, pork-filled Congressional spending bill is a disgusting abomination,” Musk, who recently stepped back from his role with the federal government, posted on X, later adding, “Congress is making America bankrupt.”
Senators began working on the legislation this week, but whatever changes they make would have to pass muster in the House. Thune is hoping to send it to President Donald Trump’s desk by July 4.
The CBO analysis also adds fuel to Democrats’ and budget watchdogs’ claims that the package, which aims to fulfill Trump’s agenda, would worsen the nation’s fiscal outlook while providing big tax cuts for the wealthy.
Trump and House GOP leaders have already sought to undercut the CBO’s projections, arguing that nonpartisan agency has missed the mark in the past and that its analyses don’t properly account for the economic growth that would result from the tax breaks. They have made similar claims about estimates from independent groups that also project a big hit to the deficit.
Some Senate leaders are looking to dodge the question of the package’s deficit impact by arguing that extending the 2017 tax cuts should be considered a continuation of current policy, and, therefore, would not contribute to an increase in the deficit. The CBO analysis is based on the standard approach of current law, in which the tax cuts expire at the end of the year, so their extension would entail a cost.
The House package calls for making permanent essentially all of the individual income tax cuts contained in the 2017 Tax Cuts and Jobs Act, a landmark achievement of Trump’s first term. The bill would also temporarily provide tax relief to certain senior citizens and workers who earn tips and overtime, which Trump promised on the campaign trail last year. And it would temporarily restore two TCJA tax breaks for businesses, including allowing them to immediately deduct the cost of research and development and equipment.
To help offset the cost of the tax relief, the House bill would enact historic cuts to Medicaid and food stamps, two of the nation’s key safety net programs. The package would institute work requirements in Medicaid, which provides health insurance to low-income Americans, and would expand the work mandate in the food stamp program, known as the Supplemental Nutrition Assistance Program, or SNAP. These provisions would result in millions of people losing their access to health coverage and nutrition assistance, according to preliminary CBO projections released earlier.
The bill would also boost spending on defense, border security and immigration enforcement, which are among Trump’s top priorities.
