The Trump administration released an outline of their plan to revise the tax code and change tax rates on April 26, 2017. The Tax Policy Center has estimated the potential impact of the administration’s proposed tax changes. TPC first analyzed the impact of the tax cut provisions, and then combined those tax cuts with potential revenue raisers. Using traditional budget scoring, TPC finds that the tax cuts outlined by the White House in April would reduce federal revenue by $7.8 trillion over the next decade. Including possible tax increases in the analysis lowers the revenue loss to $3.5 trillion. Under either case, the administration’s proposed tax changes would provide the bulk of the benefits to the highest-income households. When analyzed using dynamic scoring models of both TPC and the Penn-Wharton Budget Model, the 10-year revenue loss does not differ materially from conventional scoring methods, and the losses over the second ten years are larger.
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