The Congressional Budget Office forecasts that the legislation signed by Trump will increase the federal deficit by $3.4 trillion over the next decade, with ten million people expected to lose health insurance. The bill aims to save over $1 trillion by cutting healthcare spending, mainly from Medicaid, yet the costs will outweigh these savings. The deficit is primarily driven by GOP's permanent tax cuts extension, which will reduce federal tax income by $4.5 trillion according to CBO. Even under revised accounting methods, the bill increases the deficit by $366 billion.
The Congressional Budget Office predicts that the megabill Trump signed on July 4 would increase the federal deficit by $3.4 trillion and cause ten million people to lose health insurance.
The recently enacted legislation is projected to save over $1 trillion by cutting federal spending on healthcare, primarily from Medicaid; however, costs are expected to outweigh savings.
The primary source of the increased deficit stems from the GOP's permanent extension of Trump's 2017 tax cuts, which is expected to decrease federal tax revenue by $4.5 trillion.
CBO’s analysis included a new accounting method requested by Senate Republicans, indicating that permanent extensions of Trump's tax cuts should not count toward the deficit.
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