Committee for a Responsible Federal Budget

Media Coverage

Nov 2, 2017|Mother Jones

Republicans Unveil Huge Corporate Tax Cuts Paid For by Deficit-Spending

The budget resolution passed by the House last week allows Congress to increase deficit-spending by $1.5 trillion over the next 10 years. The TPC has estimated that Republicans initial cuts would cost $900 billion more than that. Republicans are using what nonpartisan groups like the Committee for a Responsible Federal Budget considers gimmicky and deceptive accounting to mask tax cuts that are likely to cost more than their $1.5 trillion limit.

Nov 2, 2017|Huffington Post

The Politics Of Tax Reform Are Driving Republicans, Not The Policy

Cutting the high statutory corporate tax rate would be good for competitiveness and growth, said Marc Goldwein, a policy expert with the conservative Committee for a Responsible Federal Budget. But adding an extra trillion dollars to the national debt, as Republicans have indicated they’re willing to do, would be unhelpful over the long term, he said. (The Committee for a Responsible Federal Budget does not endorse massive budget deficits.)

“There’s no scenario where the tax plan by itself is getting us a percentage point of growth a year,” Goldwein said.

Nov 2, 2017|The Hill

Republicans launch into sales push for tax plan

"While it is encouraging to see the House move forward on tax reform, it seems each new vote and milestone is a step backwards for the cause of fiscal responsibility,” said Maya MacGuineas, president of the Committee for a Responsible Federal Budget, a bipartisan policy group.

Nov 2, 2017|The Guardian

Trump's 'largest tax cut ever' could fall apart over who foots the bill

But someone has to pay for these tax cuts, and fiscally conservative Republicans are likely to defect if they see the plan doing little but adding to the national debt. After the bill was released, the non-partisan Committee for a Responsible Federal Budget called it “a bill of treats paid for by too many tricks that could harm the economy” and add $12,000 in debt to every US household.

Nov 2, 2017|LifeZette

House GOP Promises $1,182 Tax Cut for Average Family

"Not only would today's legislation cost more than $1.5 trillion over a decade, but it includes a number of gimmicks, including allowing certain provisions to expire, that could ultimately result in more than $1.5 trillion of new deficits," Committee for a Responsible Federal Budget President Maya MacGuineas said in a statement. "The bill also continues to rely on unrealistic economic growth assumptions to justify its cost."

Nov 2, 2017|The Washington Post

Republicans break their promise on tax reform

The Committee for a Responsible Federal Budget’s Maya MacGuineas warned Thursday that the House plan would cost $1.5 trillion over 10 years, and, because of the way it is written, the price could end up being even higher. “No credible model shows that tax cuts will create enough growth to fill the funding gap,” she concluded, echoing the views of most independent experts.

Nov 2, 2017|The Hill

Debt watchdogs slam Republican tax proposal

The Republican budget allows for the tax cuts to add $1.5 trillion to the deficit over 10 years. That money would be paid for by borrowing, adding to annual deficits and the nation’s overall debt burden. 

The Committee for a Responsible Federal Budget’s President Maya MacGuineas said an additional $1.5 trillion in debt amounts to almost $12,000 per household.

“Given the huge unpaid-for gap remaining, this plan does not constitute true comprehensive, revenue-neutral, and pro-growth reform,” she said.

Nov 2, 2017|The Hill

GOP refusal to deal with spending will haunt tax overhaul

But while politicians on both sides have strong feelings about the deficit, most have precious little to say about the spending that is responsible for the problem.

The Committee for a Responsible Federal Budget has called the tax plan a “a step backwards for fiscal responsibility,” citing what it called “gimmicks” and a $1.5-trillion revenue cut to the federal government.

Nov 2, 2017|The Hill

Winners and losers in the Republican tax bill

The Committee for a Responsible Federal Budget’s President Maya MacGuineas noted that the additional debt amounted to almost $12,000 per household.

“Given the huge unpaid-for gap remaining, this plan does not constitute true comprehensive, revenue-neutral and pro-growth reform,” she said.

Nov 2, 2017|LifeZette

House Plan Keeps 401(k) Contributions Tax-Free

Marc Goldwein, senior vice president and senior policy director at the Committee for a Responsible Federal Budget, said he favored eliminating the state and local tax deduction in its entirety. But he said the compromise rolls it back substantially.

"That's still pretty significant," he said.

All of the reductions the bill makes to tax breaks total between $1.2 trillion and $1.3 trillion over a decade, Goldwein said.

Nov 2, 2017|New Yorker

Donald Trump Stands to Gain Millions from the Republican Tax Bill

How so? The measure shifts the burden of taxation in the U.S. from corporations, which are largely run and owned by rich people, to households. It cuts the top rate on “pass through” business income—the sort of money generated by sole proprietorships, investment partnerships, and S-corporations—from 39.6 per cent to twenty-five per cent. And it phases out the estate tax, which falls most heavily on the largest estates, starting in 2024. Indeed, according to an analysis by the Committee for a Responsible Federal Budget, fully three-quarters of the over-all tax cuts in the bill are directed at businesses and large estates.

Nov 2, 2017|Bloomberg

House GOP Tax Bill Estimated to Add $1.49 Trillion to Deficit

A separate report Thursday from the Committee for a Responsible Federal Budget said tax cuts for individuals would result in a net cost of $300 billion, when factoring in the repeal of deductions for state and local income and sales taxes, and limits on the property tax and mortgage interest deductions. Repealing the estate tax by 2024 would add almost $200 billion to the tab, CRFB said.

Cutting the corporate rate to 20 percent from 35 percent is estimated to cost $1.5 trillion, and allowing certain pass-through businesses to take advantage of a lower 25 percent rate would lose about $448 billion, according to CRFB. Those provisions would be partially offset by limiting corporate interest deductions, eliminating certain credits and preventing companies from moving their profits offshore.

Nov 2, 2017|Chicago Tribune

Editorial: Growth, debt and a controversial GOP tax plan

But there’ll also be warnings from those of us who have long (and often unpopular) records of urging that Washington live within its means. The nonpartisan Committee for a Responsible Federal Budget noted Thursday that a $1.5 trillion debt hike “amounts to almost $12,000 per household — a steep price passed on to our children.”

Nov 2, 2017|Huffington Post

Tax Reform Is Not For The Poor

quick analysis of the legislation by the conservative Committee for a Responsible Federal Budget on Thursday indicated that two-thirds of the bill’s $1.5 trillion cost would go to business tax cuts, and another $200 billion or so would go to extremely wealthy Americans who would no longer have to pay a tax on their estates after death. (The levy, which would gradually be phased out, currently applies only to individual estates worth more than $5.49 million.)

Nov 2, 2017|The Fiscal Times

The Republican Tax Plan: The Good, the Bad and the Controversial

Budget Hawks Call the Bill Fiscally Irresponsible: “Not only would today’s legislation cost more than $1.5 trillion over a decade, but it includes a number of gimmicks, including allowing certain provisions to expire, that could ultimately result in more than $1.5 trillion of new deficits,” Maya MacGuineas, president of the Committee for a Responsible Federal Budget said in a statement. “The bill also continues to rely on unrealistic economic growth assumptions to justify its cost.”

Nov 1, 2017|CNBC

Tax plan will be a tough sell to middle class Americans: Former NEC Director

As Republicans delay the reveal of their tax plan by a day, Gene Sperling, former National Economic Council director, and Maya MacGuineas, Committee for a Responsible Federal Budget president, discuss what details they expect.

Nov 1, 2017|The Washington Post

Republicans’ tax plan so far can’t pass the laugh test

Advocates of fiscal sobriety remain skeptical. The Committee for a Responsible Federal Budget warns Americans to be on the lookout for familiar gimmicks designed to hide massive debt:

Well-designed tax reform has the potential to improve economic growth and thus generate some additional revenue from “dynamic feedback.” Advocates of tax reform have claimed such feedback could total $1 trillion or even $2 trillion. These numbers are highly unlikely and certainly should not be counted on.

In reality, dynamic feedback for a well-designed tax reform plan is more likely to produce closer to $300 or $400 billion of dynamic feedback over a decade, and debt-financed tax cuts may ultimately slow economic growth over the medium and long term and result in little net positive feedback at all.

Likewise CRFB cautions against using sunset provisions to comply with reconciliation rules. “There is a high likelihood that Congress will rely on sunsets to make a $1.5 trillion ten-year tax cut appear to cost nothing in the second decade — with the assumption that future Congresses will extend various debt-increasing tax cuts before they expire as they did with the 2001/2003 tax cuts,” CFRB explains. “Their unified framework proposed to allow corporations to immediately deduct the cost of equipment — a provision known as expensing — but proposed that this measure be in effect for ‘at least five years’ rather than permanently. In addition to undermining the growth impact of expensing, making this provision temporary obscures the cost. While five years of equipment expensing would cost $300 billion, including interest, permanent expensing would cost three times that.”

Nov 1, 2017|The Washington Post

President Trump’s tax cut: Not ‘the biggest’ in U.S. history

In other words, Trump’s tax cut would even be smaller than two tax cuts passed by Congress under President Barack Obama. We’re sure that must be a source of irritation. In fact, Trump’s tax cut would even fall behind Obama’s tax cuts when measured by inflation-adjusted dollars, according to the Committee for a Responsible Federal Budget.

Here’s a useful chart put together by CRFB, which labels the Trump tax cut as “Framework.” The group also included an estimate for a 1921 tax cut from a 2012 paper by Christina Romer and David Romer.

Nov 1, 2017|FactCheck.org

Largest Tax Cut in History?

The Committee for a Responsible Federal Budget said it “very roughly” estimated a $2.2 trillion cost over 10 years. (That’s similar to the Tax Policy Center’s estimate of a $2.4 trillion cost over 10 years.)

“That would make this tax cut the 8th largest as a percent of Gross Domestic Product (GDP) since 1918 and the 4th largest in inflation-adjusted dollars,” CRFB wrote in an Oct. 25 blog post.

CRFB used a Treasury Department analysis that we also have referred to in the past. The 2013 report, by tax analyst Jerry Tempalski, detailed the revenue effects of major tax legislation. (Tempalski prepared such a report in 2006, and updated the tax tables in 2011, too.)

Nov 1, 2017|Yahoo! Finance

Obama's tax cut was bigger than what Trump is proposing

Trump has promised “the biggest tax cut in U.S. history,” which is more Trumpian overstatement than usual.  The cuts Trump has outlined would amount to $190 billion at the most, or a bit more than 1% of GDP, and they’ll probably come in way below that once Congressional negotiations are complete. As outlined, the Trump cuts would only be the eighth largest, as a percentage of GDP, in the last 100 years, according to the Committee for a Responsible Federal Budget.

Nov 1, 2017|The Washington Post

Who’s really going to pay for Trump’s big tax cut?

“This move is a sharp reversal from previous Republican promises of revenue-neutral tax reform,” wrote the nonpartisan Committee for a Responsible Federal Budget in a memo Friday.

Here's the basic math. CFRB estimates the total cost for the entire tax package is $5.8 trillion over 10 years, meaning about a quarter of the bill will come from debt financing. The rest is supposed to come from someone (or some business) paying more, but so far, Republicans have struggled to identify who that will be.

Nov 1, 2017|USA Today

Trump wants to pay for tax cuts by repealing Obamacare individual mandate

To put that figure in the context of tax cuts, repealing the estate tax – as Republicans want to do -- would cost $200 billion over ten years. Doubling the standard deduction would cost $700 billion. Changing the individual tax rate structure and eliminating the alternative minimum tax would cost $1.7 trillion, according to the nonpartisan Committee for a Responsible Federal Budget.

Nov 1, 2017|Newsweek

Trump's Tax Cut Would Be Smaller Than Obama's, Analysis Says

Trump's proposal would save Americans a maximum of $190 billion, according to a new analysis from the nonpartisan Committee for a Responsible Federal Budget. That sounds like a lot, but it's equivalent to about one percent of gross domestic product, the leading measure of our nation’s economic output. By that measure, Trump's cut would be the eighth largest since 1918. Obama's 2013 cut, at 1.8 percent of GDP, was the fourth largest over that period. It saved American taxpayers $321 billion per year.

Nov 1, 2017|Los Angeles Times

Conservatives lament retention of top tax rate in GOP plan, but the wealthy still reap big benefits

“The wealthy are going to do fine,” said Maya MacGuineas, president of the nonpartisan Committee for a Responsible Federal Budget. “This is not even asking them to pay more. This is just slightly reducing the tax cut they’re already in line for under this plan.”

Oct 31, 2017|The Washington Post

Republicans to propose keeping top tax rate for very wealthy, working to win over moderates

Overall, House Republicans say their plan will reduce federal tax revenue by $1.5 trillion over the next decade. Keeping the tax rate for people earning over $1 million could reduce the impact on the deficit by about $200 billion over a decade, according to the Committee for a Responsible Federal Budget.

Oct 29, 2017|Huffington Post

GOP Doesn’t Seem To Hate Debt So Much Now That It Wants A Tax Cut

Last week the House passed a budget framework already passed by the Senate that permits $1.5 trillion in new debt from the tax cuts. That figure could increase substantially if some Republicans get their wish to use alternative methods of “scoring” the legislation that would lower its price tag for the purpose of meeting that cap. The non-partisan Tax Policy Center said the proposal will cost $2.5 trillion over a decade, while the bi-partisan Committee for a Responsible Federal Budget estimates a $2.2 trillion cost, based on the details available thus far.

Republican leaders argue the tax cuts will really cost nothing, because the economy will grow so fast that more money will flow into the treasury despite the tax rate reductions. “Not only will this tax plan pay for itself, but it will pay down debt,” Treasury Secretary Steven Mnuchin said last month.

Those arguments do not impress Maya MacGuineas, the CRFB’s president, who calls them “bogus” and “free-lunch-enomics.”

“Clearly, this is a massive budget buster,” she said. “Tax cuts don’t pay for themselves.”

Oct 27, 2017|Yahoo! Finance

Slashing 401(k) limits to fund budget is like 'robbing Peter to pay Paul'

The Tax Foundation and the Committee for a Responsible Federal Budget’s Marc Goldwein also called it a “budgetary gimmick.”

“Roths are a worse deal for the federal government — probably more revenue is lost,” he told Yahoo Finance. “So if anything, switching from traditional tax-deferred plans to Roth IRAs is probably a long-term loss.”

Oct 27, 2017|The Hill

The Memo: Trump tax reform nears crunch time

In essence, any changes to the tax code can increase the deficit by $1.5 trillion over a decade but no more. At present, the cuts are projected to cost much more than that — though how much is disputed. A rough analysis from the Committee for a Responsible Federal Budget put the tag at $5.5 trillion.

Oct 27, 2017|Washington Examiner

Blue Dog leaders ask House Republicans: What happened to fiscal discipline?

This year alone, the national debt surpassed $20 trillion for the first time in U.S. history, and we have seen the largest annual budget deficit in four years. Yet, House Republicans just passed a partisan budget that bypasses the PAYGO rules and will add up to $1.5 trillion to the national debt. That budget will serve as a vehicle to pass a tax bill based on the Freedom Caucus-endorsed “Big Six” tax framework, which the Committee for a Responsible Federal Budget has estimated could cost up to $2.2 trillion, and the Tax Policy Center has estimated would cost $2.4 trillion over the next decade.

Oct 27, 2017|Fox Business Network

Trump economy: GDP up 3 percent, consumer sentiment rises, stocks rally

The Bahnsen Group of HighTower CIO David Bahnsen and Committee for a Responsible Federal Budget’s Maya MacGuineas discuss the economic surge in the U.S. economy under President Trump.

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