In Washington, recent modifications to President Donald Trump’s substantial tax bill in the Senate are projected to exacerbate the nation’s debt significantly, as per a fresh assessment by the nonpartisan Congressional Budget Office (CBO). These developments present additional hurdles for Republicans striving to secure the bill’s passage. The analysis forecasts that the Senate’s iteration of the bill would amplify the deficit by close to $3.3 trillion between 2025 and 2034, marking an approximately $1 trillion rise over the House-passed version, which the CBO had previously forecasted would contribute $2.4 trillion to the national debt over the next decade.
Moreover, the study indicates that should the bill be enacted, 11.8 million more Americans would be uninsured by 2034, reflecting an increase when compared to the House version, which anticipated 10.9 million additional individuals lacking health coverage. This stark revelation adds to the array of obstacles faced by Republican leaders as they endeavor to pass Trump’s bill by his self-imposed July 4th deadline.
Prior to the CBO’s findings, there was already unrest among Republicans regarding the legislation’s content; some members opposed the cost-cutting strategies aimed at reducing Medicaid and food aid expenditures, while others argued these proposals were insufficient. These program cuts are mainly intended to offset the expenses of prolonging $3.8 trillion in tax cuts from Trump’s first term.
The discord was evident during a routine procedural vote on Saturday night. The crucial vote saw a delay as Vice President JD Vance and key Republican leaders met intensively with several undecided members. Eventually, the bill proceeded with a 51-49 vote; however, its future remains uncertain with numerous amendments pending consideration.
Despite such opposition, many Republicans challenge the CBO’s estimations, disputing their accuracy. To facilitate the bill’s passage, they have adopted an alternative budget baseline that presumes the Trump tax cuts set to expire in December are already extended, thereby presenting them as budget-neutral.
Additionally, the CBO offered an alternate analysis favoring the GOP’s perspective, suggesting that the Senate bill could potentially reduce the deficit by roughly $500 billion. However, Democrats and economists criticize this approach, dubbing it as “magic math” that masks the true fiscal implications of the tax breaks.
Democrats further argue that by traditional scoring, the Republican tax plan would contravene the Senate’s “Byrd Rule,” which prohibits legislation from increasing deficits beyond a ten-year period. In a correspondence addressed to Senator Jeff Merkley of Oregon, the lead Democrat on the Senate Budget Committee, CBO Director Phillip Swagel conveyed that under conventional scoring, the bill, particularly Title VII from the Finance Committee, would “increase deficits post-2034.”