Dallas, TX
President Trump’s proposed tax plan will create 3,000,000 new jobs and 5 percent economic growth in the first year alone. But the tax cuts and proposed additional spending will translate to large future fiscal imbalances for taxpayers in the coming years, according to an analysis from the NCPA.
“If implemented, the plan would be a boom to the economy,” says NCPA Senior Fellow Pam Villarreal, author of the report. “But spending cuts would need to accompany projected revenue shortfalls.”
NCPA Senior Fellow Dr. David Tuerck and his team at Beacon Hill Institute modeled the deficit side of the Trump tax plan using the NCPA-DCGE model. The results:
- The present value of future deficits under the Trump tax plan, $53 trillion, is nearly twice that of the present value of deficits under current law CBO estimates.
- In 2046, the last year of the forecast horizon, the total federal debt held by the public will be 62 percent higher under the Trump tax plan.
- On a per capita basis that translates to $264,976 per person under the Trump tax plan in 2046, compared to $163,503 per person under the current law baseline estimates.
“President Trump’s plan to cut the tax on business profits to 15 percent is the most pro-growth idea to come out of presidential politics since the election of Ronald Reagan in 1980. But his apparent unwillingness to face up to the deficits his tax proposals would engender threaten to undo his entire pro-growth agenda. It is time for him to face up to this reality and to start considering entitlement reform and other budget cutting measures,” says Tuerck.