The GOP Tax Bill Will Add $2.3 Trillion to the Deficit, CBO Says

The major tax bill that Republicans hope to pass through the House later this week will require the federal government to borrow more heavily for the next five years, while postponing spending cuts and other deficit-reducing measures until 2028 or beyond.

In many cases, those future spending cuts and tax increases are unlikely to ever materialize. Instead, they seem meant to manipulate the calculations done by the Congressional Budget Office (CBO) and other independent entities that assess the budgetary impact of legislation.

Even with those gimmicks included in the bill, however, the CBO estimates that the One Big Beautiful Bill Act will add more than $2.3 trillion to the deficit over the next 10 years. The bill would increase borrowing by more than $400 billion in each of the next four years—topping out at nearly $600 billion in new borrowing in 2027.

The House bill will add $600 billion to the 2027 deficit, based on CBO. pic.twitter.com/NDWR8QZbQa

— Marc Goldwein (@MarcGoldwein) May 21, 2025

Other assessments of the bill by the Yale Budget Lab and the Penn Wharton Budget Project expect it to add more than $3 trillion to the deficit, as written.

As the Committee for a Responsible Federal Budget noted in its analysis of the tax bill, 70 percent of the bill’s non-interest borrowing will occur in the first five years, while most of the deficit-reduction efforts occur in the second half of the 10-year budget window.

Be skeptical about that second part. Many of the most high-profile parts of the tax bill—the expanded child tax credit, a provision exempting tips from income taxes, and a new tax-advantaged savings program for parents and children—are set to expire in 2028 and 2029.

No one realistically expects them to vanish at that point, but by making those provisions “temporary” in the bill, lawmakers can game the CBO scoring process and limit the perceived impact on the deficit. After all, what good is a long-term savings program for parents and kids that disappears after a few years?

A plan to add a work requirement to Medicaid, the joint federal-state health insurance program for the poor, also won’t take effect until 2028. The estimated $300 billion in future budgetary savings created by that provision will materialize only if a future Congress doesn’t postpone or abolish the work requirement.

“This is Washington gimmicky budgeting of the highest order, since exactly zero human beings think that the later-year spending cuts will actually kick in,” wrote Paul Teller, executive vice president of Advancing American Freedom, a conservative think tank, in a post on X. “In order to save America, the spending cuts must be real, must be significant, and must start now!”

Unlike the CBO, the Yale Budget Lab also ran an estimate that assumes the temporary provisions in the bill are made permanent. If that happens, the bill would add $5 trillion to the deficit over 10 years.

In other words, the CBO’s estimate that the bill will add only $2.3 trillion to the deficit over 10 years might capture less than half of the actual borrowing that would occur if this bill becomes law.

With the country already deep in debt, and with that debt now pushing interest rates higher and slowing economic growth, committing to trillions of dollars of additional borrowing over the next decade seems wildly irresponsible.

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