The first reviews are in and they agree on this much: Donald Trump’s tax plan carries a hefty price tag.
Analysts at the left-leaning Citizens for Tax Justice and the conservative-leaning Tax Foundation released top-line estimates on the Republican presidential front-runner’s tax plan that was unveiled Monday.
According to the Citizens for Tax Justice, Trump’s tax proposal would reduce revenues by around $900 billion per year, which would translate to about $9 trillion over a decade. The Tax Foundation is singing a similar tune: It predicts that the billionaire’s plan would reduce tax revenue by some $10 trillion over the next 10 years (when measured alongside economic growth).
The real estate mogul is proposing deep cuts to the income tax rate for people across the board.
His idea is to allow those at the bottom-most income bracket (singles making $25,00 or less and married couples making $50,000 or less) to pay no income taxes, and reduce the top income tax rate from the current rate of around 40% to 25%.
Trump’s campaign manager Corey Lewandowski pushed back on the cost estimates, calling on the groups to “go back and take a look at the actual plan.”
“We project at a 3% growth rate that this plan is revenue neutral,” he said on CNN’s “Situation Room.” “If we’re fortunate enough that the economy of this country continues to grow which we think it would under this plan … then anything above a 3% growth rate – which is a very modest growth rate – would allow us to continue to reduce the deficit.”
And Hope Hicks, Trump’s campaign spokesperson, said the estimates “seem to largely ignore most of the plan’s pay-fors.”
“But even accounting for that, their figures seem wildly off the mark,” she said.
Trump promised in a press conference Monday that his proposal would not add to the country’s debt or deficit. Pressed by CNN’s Erin Burnett on how he would offset the deep tax cuts, Trump answered in broad terms, saying much of the money would come from increased job growth and investments at home.
“The economy’s going to just be absolutely like a rocket,” he said.
The Tax Policy Center, a joint group run by the Urban Institute and the Brookings Institution, has yet to score Trump’s plan. But Eric Toder, the group’s co-director, told CNN Tuesday that it is difficult to see how the revenue loss would be made up.
“Without having scored it, just looking at the numbers, there’s probably going to be a pretty big revenue loss,” Toder said. “That’s the big story.”