Federal revenue continues to soar with Trump tax cuts, CBO report shows

[excalibur]

In spite of all the lies from the left and the usual CBO incompetence.

Why so many lies from Democrats and the MSM about the Trump tax cuts?

Tax cuts signed into law in 2017 by then-President Donald Trump have raised revenues for the federal government over the last five years, despite concerns among Democrats and other critics that the cuts would be a fiscal nightmare only benefiting the rich.

The government collected a record $4.9 trillion in revenue last year, according to the latest report from the Congressional Budget Office, a nonpartisan federal agency. That's nearly $500 billion higher than what the CBO had projected.

Receipts from corporate income taxes, meanwhile, were $425 billion, exceeding CBO's projection by 25%, while receipts from individual income taxes were $2.6 trillion, exceeding CBO's projection by 11%.

Federal revenues are now up about $1.5 trillion, or roughly 40%, since the Trump tax cuts went into effect at the beginning of 2018. By comparison, the cuts were initially estimated to cost the government $1 trillion, according to the Joint Committee on Taxation.

"We have higher tax revenue right now than we've ever had in the history of the country," Rep. Austin Scott (R-Ga.) told the John Solomon Reports podcast. "Think about that: Everything we've been through — COVID, inflation, all of the challenges of the last 36 months that our country has had — we have higher tax revenues than we have ever had in the history of the country."

Trump signed the Republican-backed Tax Cuts and Jobs Act into law in December 2017. The legislation simplified tax filing for many families and lowered the tax rates paid by most filers. It also cut business taxes, including lowering the corporate income tax rate from 35% to 21%.

Democrats and experts from left-leaning organizations blasted the tax cuts as a ploy to benefit the rich exclusively in a move that would cause deficits to soar.

"Last time Republicans held the majority, they enacted a $2 trillion tax scam that funneled massive windfalls to the biggest corporations and wealthiest families — which increased the deficit because the GOP did not provide offsets," Rep. Nancy Pelosi (D-Calif.) said Monday in a press release, echoing a common talking point of hers.

President Biden has similarly said "all" of the tax cut benefits "went to folks at the top and corporations," a claim deemed "false" by the Washington Post's fact-checker. Biden's White House has also claimed the Trump tax cuts would add trillions to deficits over the next decade due to less revenue.

However, beyond raising revenues, the Tax Cuts and Jobs Act lowered taxes for all income groups, particularly the middle class, according to studies and government data.

Americans with adjusted gross income (AGI) between $50,000 and $74,999 saw a 15.2% reduction in average tax liabilities between 2017 and 2019, the year of the agency's most recent available data, according to an analysis by Americans for Tax Reform. During that same period, Americans with AGI of between $75,000 and $99,999 saw a 15.6% reduction in average federal tax liability.

In 2018, middle- and working-class Americans received tax cuts of between 11% and 88%, at least double that of wealthier taxpayers, according to an analysis of IRS income tax data by the Heartland Institute. Those earning between $500,000 and $1 million received single-digit cuts, and those reporting an AGI of between $5 million and $10 million paid just 3.5% less in taxes.

"It is the working class who have made the biggest gains under the Tax Cuts and Jobs Act," Rep. Jason Smith (R-Mo.), the new chair of the powerful House Ways and Means Committee, said in December to mark the five-year anniversary of the Trump tax cuts. "Not only did working families get to keep more of their paycheck, but their paychecks grew the fastest compared to every other income group."

...​

Federal revenue continues to soar with Trump tax cuts, CBO report shows

The Tax Cuts and Jobs Act, which critics said would only benefit the rich, has led to a windfall into the government's coffers.

justthenews.com

 

[EvilCat Breath]

We need President Trump back in the white house.

 

[Moonglow]

We need President Trump back in the white house.

Yeah, like we need a dose of the clap.

 

[Moonglow]

Your fake news site is misleading as to the reasons for increased revenue.
Individual Income Taxes. CBO’s projection of receipts from individual income taxes in 2022 was $2,336 billion, $297 billion (or 11 percent) less than the actual amount of $2,632 billion. That underestimate is partly the result of higher-than-expected nominal income (that is, income measured in current dollars) subject to the individual income tax, reflecting higher inflation than CBO anticipated when it published its projections. In late September 2022, the Bureau of Economic Analysis (BEA) revised its estimates of nominal income, which rises with inflation, for calendar years 2021 and 2022. BEA’s revised estimate of income was 2 percent higher for calendar year 2021 and 5 percent higher for the first half of 2022 than CBO originally anticipated.

Other factors not yet identifiable in the available data may have contributed to the projection error, including the following:

• A larger portion of earnings may have accrued to workers at the top of the distribution than CBO projected, so that earnings were taxed at a higher rate, on average, than expected.
• Realizations of capital gains, particularly in calendar year 2021, may have been larger than CBO estimated, or a larger share of those realizations may have come from sales of assets held for less than a year, which are subject to higher tax rates.
• Temporary tax provisions aimed at reducing people’s tax burdens during the coronavirus pandemic may have been less widely used than CBO anticipated.

The Accuracy of CBO’s Budget Projections for Fiscal Year 2022

Notes Notes Unless this report indicates otherwise, all years referred to are federal fiscal years, which run from October 1 to September 30 and are designated by the calendar year in which they end. Numbers in the text, tables, and figures may not add up to totals because of rounding.

www.cbo.gov

 

[Moonglow]

Increased revenue comes from increased economic activity, inflation, and higher wages.

 

[Moonglow]

Trump's tax cuts did do one thing, helped to increase the debt while he was president.

 

[Smokin' OP]

We need President Trump back in the white house.

Well, we do have his son in congress.

 

[pknopp]

We pumped and pumped and pumped from 2017 until 2020. That's what raised revenue and the debt and (along with all the other years of pumping) led to inflation.

 

[Moonglow]

President Donald Trump’s tax, spending, and deficit legacy is still being defined. Critics point out that Trump’s tax cuts and spending increases led to a $3 trillion budget deficit. They note that Trump’s presidency saw the debt surpass 100% of the economy, even though he came into office with a healthy economy, declining interest rates, and relative peace after 15 years of global military conflict.

On the other hand, the president’s defenders respond that he inherited large budget deficits that were already projected to grow on autopilot due to escalating Social Security and Medicare costs. They argue that the 2017 tax cuts contributed heavily to the growing economy through 2019. Finally, they note that the president repeatedly proposed budgets with significant deficit reduction but was thwarted by a bipartisan congressional majority that aggressively supported expensive new initiatives, as well as by a global pandemic that virtually everyone agreed required a massive federal response.

The end of Trump’s presidency allows for a final assessment of his tax, spending, and deficit record. As the methodology section explains, this analysis begins with the 10-year budget baseline that President Trump inherited in January 2017 and measures all subsequent tax and spending changes through the February 2021 baseline, which was released as the president left office. The analysis is based on more than a dozen Congressional Budget Office (CBO) baseline updates over these four years, supplemented with the line-item scores of all notable bills signed into law by President Trump.[1]

KEY FINDINGS​

• When President Trump entered the Oval Office, CBO projected the cumulative 2017–2027 budget deficits would be $10.0 trillion. When he left office four years later, CBO’s projected deficits for the same period were $13.9 trillion. The president signed or enacted $7.8 trillion in new initiatives, the costs of which were partially offset by $3.9 trillion saved from economic growth revenues and technical re-estimates of taxes and spending levels.
  
• Economic and technical factors produced a substantial $3.9 trillion in actual and projected savings over this period. Of this amount, $2.7 trillion comes from falling interest rate projections, which reduced the projected cost of net interest on the national debt. Another $1.3 trillion comes from higher tax revenues produced by faster economic growth projections. Technical re-estimates have reduced mandatory spending projections but also tax revenues. Most of these savings are projected to occur later in the 2017–2027 period and thus may not materialize if economic growth slows or interest rates rise.
  
• President Trump signed legislation and approved executive actions costing $7.8 trillion over the decade—compared to $5.0 trillion for President Obama and $6.9 trillion for President Bush, and he enacted these costs in just a single four-year presidential term, compared to his predecessors’ eight years in the Oval Office. The largest drivers were pandemic relief legislation ($3.9 trillion), the 2017 tax cuts ($2.0 trillion), and legislation raising the discretionary spending caps ($1.6 trillion).
  
• President Trump’s four annual budget proposals were scored as reducing budget deficits by $2.4 trillion over the subsequent 10 years. Nearly all proposed savings came from repealing and replacing Obamacare, as well as vague promises to cut domestic discretionary spending nearly in half. Outside of the budget documents, President Trump did not aggressively push either initiative after 2017.
  
• Trump left the White House with the largest peacetime budget deficit in American history and a national debt exceeding 100% of the economy for the first time since World War II. The failure to address unsustainable Social Security and Medicare costs leaves a projected 30-year baseline deficit of $112 trillion.
• Trump’s Fiscal Legacy: A Comprehensive Overview of Spending, Taxes, and Deficits | Manhattan Institute

 

[Moonglow]

This increase is a result of “larger-than-anticipated” payments of individual income taxes, payroll taxes and corporate income taxes for calendar year 2021. The growth in individual tax revenues came from nonwithheld taxes, such as capital gains, and from payroll taxes, according to the CBO.

Increase in Federal Tax Revenue Drives Record Budget Surplus​

 

[alang1216]

Trump's tax cuts did do one thing, helped to increase the debt while he was president.

I guess the GOP no longer cares about the debt.

CBO Confirms GOP Tax Law Contributes to Darkening Fiscal Future In a hearing last week, Congressional Budget Office (CBO) Director Keith Hall presented the agency’s updated Budget and Economic Outlook. The report shows a darkening fiscal future, with trillion-dollar deficits and record debt levels expected within a decade.

 

[pknopp]

Trump left the White House with the largest peacetime budget deficit in American history

One must note, while Trump did not start new wars, we were never at peace during any time of his presidency.

 

[LeftofLeft]

Trump's tax cuts did do one thing, helped to increase the debt while he was president.

Spending is the primary factor that impacts debt, not tax cuts. Prove me wrong.

 

[Moonglow]

Spending is the primary factor that impacts debt, not tax cuts. Prove me wrong.

A reduction in revenue increases debt just like over spending.

 

[pknopp]

Spending is the primary factor that impacts debt, not tax cuts. Prove me wrong.

You didn't actually say anything. Did the spending add more to the debt than the tax cuts? Sure, but the fact is, BOTH added to the debt.

 

[LeftofLeft]

A reduction in revenue increases debt just like over spending.

Spending is the larger determinant. When revenue declines, you cut spending.

 

[LeftofLeft]

You didn't actually say anything. Did the spending add more to the debt than tax cuts? Sure, but the fact is, BOTH added to the debt.

Again, spending is the primary factor.

 

[wamose]

We should budget 90% of the gross tax receipts from the previous year and use the other 10% for debt reduction.. That would be the best way to pay down our debt. The hard part is to find enough non crooked politicians to implement it.

 

[pknopp]

Spending is the larger determinant. When revenue declines, you cut spending.

When you are trillions in debt you don't cut revenue.

Basic econ 101 also taught that when things were booming, you raise taxes. Trump bragged all the time that the economy under him was the best ever. That is when you are supposed to raise taxes to pay for times it was bad.

 

[pknopp]

Again, spending is the primary factor.

Again, irrelevant. Both added to the 7.8 trillion dollar deficit under Trump.