Research findings suggest that Trump's tax reform could potentially result in additional trillions of dollars in federal U.S. debt. - U.S. Debt Increase Projected by Trump's Tax Plan Evaluation
A Fresh Look:
The $2.8 Trillion Debt Hike: Breaking Down Trump's Tax and Spending Bill
Time to read: 1 Min
Don't fancy the numbers? Let's break it down: President Donald Trump's proposed tax and spending legislation, affectionately known as the "One Big Beautiful Bill Act," could send U.S. debt soaring by a whopping $2.8 trillion over the next decade, according to a recent estimate from the nonpartisan Congressional Budget Office (CBO). Even with positive economic effects factored in, that's quite a significant chunk of change!
Previously, without taking those economic impacts into account, the CBO predicted an increase of $2.4 trillion in public debt from the current $36.2 trillion. Once you add interest costs, you're looking at $3 trillion.
Controversial Move vs. Economic Claims
The latest estimate goes against Republicans' assertions that the comprehensive package will pep up the U.S. economy enough to lower public debt through higher revenue. "It will create a stronger, more prosperous America," said Senate Majority Leader John Thune, a Republican.
The House of Representatives already gave the bill the green light in May. Current discussions in the Senate revolve around a revised version. For the bill to become law, both chambers of Congress must agree on a common version, which can then be presented to Trump.
The current draft proposes extending the tax cuts from Trump's first term, set to expire at year's end, all the way to 2021. To compensate for this, significant cuts to the Medicaid healthcare program, primarily serving low-income and elderly individuals, have been proposed.
- Tax Bill
- Donald Trump
- USA
Insights:
- The CBO projects that the tax and spending bill could increase the U.S. budget deficit by approximately $2.4 trillion (excluding debt-service and macroeconomic effects) over the 2025–2034 period [2][3].
- The bill’s potential cumulative deficit increase if certain tax provisions are made permanent could reach $4.5 trillion [3].
- The bill includes tax cuts estimated to total $3.7 trillion and spending cuts of $1.2 trillion [2].
- The CBO anticipates that about 10.9 million more people could be uninsured by 2034 due to changes in Medicaid under the bill, potentially elevating the total uninsured population by 16 million over the decade due to other changes in Affordable Care Act enrollment and tax credits [2].
- The proposed tax and spending legislation championed by President Donald Trump, often referred to as the "One Big Beautiful Bill Act," is currently under debate in the USA, with the nonpartisan Congressional Budget Office estimating it could escalate the national debt by approximately $2.8 trillion over the next decade.
- The ongoing debate over the tax bill in the USA revolves around the significant tax cuts proposed, totaling an estimated $3.7 trillion, and potential reductions to Medicaid, which predominantly serves low-income and elderly individuals, as a means to compensate.
