WASHINGTON _ Almost 1 in 10 taxpayers would initially see a tax hike under the revised Senate Republican tax plan, and the proposal would add as much as $2.4 trillion in long-term debt, according to two new analyses raising fresh concerns ahead of next week's expected Senate vote.
The Tax Policy Center said that while taxes on average would be reduced across all income groups under the plan, 9 percent of taxpayers would pay more in 2019 and half would pay more by 2027, as the tax cuts for individuals expire. Lower-income households would initially see average tax cuts of $50 a year, about 0.3 percent of after-tax income, while upper-income households would see cuts of more than $12,000, or 3.5 percent of after-tax income.
At the same time, a Penn Wharton budget model released Tuesday said revenues would fall between $1.3 trillion and $1.5 trillion by 2027, on par with other outside analyses, but in the next decade, revenues would fall between $1.1 trillion and $2.1 trillion, increasing the federal debt by $1.7 trillion to $2.4 trillion by 2040.
That's less than earlier projections of up to $7 trillion in debt, before Senate Republicans revised the bill to keep costs down, in part by allowing the individual tax cuts to expire. But it may still concern some budget hawks.
Under both the House and Senate bills, the corporate rate cut, from 35 percent to 20 percent would be permanent, because, Republicans argue, lower business taxes will spur economic growth.
Tuesday's Penn Wharton report said growth would be between 0.3 percent and 0.8 percent higher in 2027 than without the Senate package, also similar to earlier projections.
