Democrats’ $1.8 Trillion Spending Plan Could Add $367 Billion To Budget Deficit In 10 Years Despite New Taxes, CBO Finds

The Congressional Budget Office on Thursday finished assessing Democrats’ sweeping $1.8 trillion social spending proposal and concluded it would add about $367 billion to the nation’s budget deficit over the next decade, falling short of claims the package would fully pay for itself—even with additional revenue from tax enforcement activities.

Enacting the Build Back Better Act would increase the budget deficit by about $367 billion between 2022 and 2031, CBO said Thursday, not including revenue from new measures to bolster tax enforcement.

Still, CBO projected those tax enforcement activities would reduce the deficit by only about $207 billion in the next 10 years—significantly less than the “conservative” $400 billion estimate from the White House.

House Speaker Nancy Pelosi (D-Calif.) told lawmakers Thursday the chamber could proceed to a final vote on the bill “as soon as” CBO released its final budget estimates for review by House members, including a few Democrats who said they’d reject a vote without the estimates.

Despite the worse-than-expected findings, it’s not yet clear it’ll be a dealbreaker for House Democrats: Rep. Kurt Schrader (D-Ore.), who withheld support for a vote until CBO’s scores were released, said this week he wouldn’t be “dissuaded” by a lower score because the agency doesn’t include revenue from certain investments in its projections.

Senate Finance Chair Ron Wyden (D-Ore.) alluded to that in a statement after CBO’s findings were released, saying he’s “confident” in the Treasury’s estimate that investing in the IRS will generate at least $400 billion in additional tax revenue from “wealthy tax cheats.”

The new report comes after a separate nonpartisan analysis released earlier this month by the Joint Committee on Taxation estimated the plan’s proposed new taxes would raise about $1.5 trillion in revenue, similarly falling short of the bill’s total price tag although it didn’t account for tax enforcement provisions.

-Forbes

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