How Trump’s Tax Bill Could Increase the Deficit by $2.4 Trillion and Leave 10.9 Million Uninsured: Insights from the CBO

Big Changes Ahead: Trump’s Tax Bill in Congress

In Washington, President Trump’s tax bill is creating quite a stir. It aims to cut taxes by $3.75 trillion but warns that this could raise the national deficit by $2.4 trillion over the next decade. According to the Congressional Budget Office (CBO), this package might leave an additional 10.9 million people without health insurance by 2034. This number includes about 1.4 million undocumented individuals who rely on state-funded programs.

The CBO also notes that federal spending would drop by nearly $1.3 trillion over the same period. Representative Brendan Boyle, a Democrat from Pennsylvania, expressed strong disapproval, calling the bill a “disgusting abomination.” Interestingly, he echoed comments from billionaire Elon Musk, who has criticized the bill’s direction.

House Speaker Mike Johnson shared that he reached out to Musk to discuss his concerns but was still waiting for a response.

A Legislative Sprint

As Congress debates this bill, Trump is urging lawmakers to finalize it quickly—ideally by Independence Day. The CBO’s analysis will play a crucial role in uncovering the bill’s financial impacts. Recently, the White House and GOP leaders have been questioning the CBO’s credibility, accusing it of being historically inaccurate.

For instance, Senate Majority Leader John Thune claims the CBO underestimated the revenue from Trump’s previous tax cuts in 2017. He argues that the inflation spike during the COVID-19 pandemic significantly affected tax receipts, which were $1.5 trillion higher than anticipated.

What’s in the Bill?

The bill, referred to as the "One Big Beautiful Bill Act," is the Republicans’ top priority. It aims to extend individual income tax breaks from 2017 that are set to expire soon, alongside introducing new tax proposals, such as eliminating taxes on tips. Additionally, there’s a considerable $350 billion allocation for border security and national defense.

On the other hand, Republicans propose slashing some federal spending to cover the lost revenue. They plan to phase out green energy tax breaks from the Biden era and implement new work requirements for certain adults on Medicaid and SNAP starting in December 2026. GOP leaders argue that these changes would strengthen programs by eliminating waste, fraud, and abuse.

Democratic leaders, however, have labeled these justifications as misleading, claiming they aim to undermine the Affordable Care Act, also known as Obamacare.

Criticism of the CBO

The CBO, celebrating its 50th anniversary this year, was created to provide Congress with nonpartisan economic data. Its current director, Phillip Swagel, is a former Treasury official appointed by George W. Bush. However, some GOP members are questioning its objectivity, even suggesting the need to reassess its role in the budget process.

House Majority Leader Steve Scalise mentioned that the CBO has consistently been wrong in its economic predictions. He noted that this criticism is valid and deserves consideration.

Conclusion

As this tax bill progresses through Congress, the debate is heating up. Issues like healthcare, spending, and national debt are front and center. With polarized opinions and a push for swift action, it remains to be seen how lawmakers will resolve these challenges. The stakes are high, not just for current taxpayers but for the overall economy and future generations.

For more insight into the potential impacts of tax reforms, you can read the CBO’s full report on budget and economic forecasts.

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