The Joint Committee on Taxation (JCT) on December 11 provided a comparison of the revenue provisions contained in the House and Senate versions of the Tax Cuts And Jobs Act (HR 1). The JCT also provided its macroeconomic analysis of the House version of the tax bill. In addition, the Treasury Office of Tax Policy (OTP) released a one page analysis of growth and revenue estimates based on the Senate version of HR 1.
The JCT macroeconomic analysis estimates that the House bill would increase GDP by about 0.7 percent on average over the 10-year budget window. That increase in output would increase revenues by about $483 billion over that period. However, the revenue increase would be partially offset by an increase in interest payments on the federal debt of about $55 billion over the budget period. The JCT expects that both an increase in GDP and resulting additional revenues would continue in the second decade after enactment, although at a lower level, as the incentive effects of several provisions weaken over time.
Treasury OTP Analysis
The Treasury Department Office of Tax Policy (OTP) also released a one-page summary analysis of the expected tax receipts associated with the Senate version of HR 1. Among the key findings is that $1.8 trillion of additional revenue would be generated over 10 years based upon expected growth. The OTP also projects that approximately 0.35 percent of incremental annual GDP growth would generate approximately $1 trillion of incremental revenue.
“We are pleased to release an analysis demonstrating the revenue impact of the Administration’s economic agenda. The Administration has been focused on tax reform and broader economic policies to stimulate growth, which will generate significant long-term revenue for the government,” said U.S. Treasury Secretary Steven T. Mnuchin.
By Deborah Petro, Wolters Kluwer News Staff
JCT Comparison of the Revenue Provisions Contained in HR 1, the Tax Cuts And Jobs Act, as Passed by the House of Representatives, and as Amended by the Senate, JCX-65-17
JCT Macroeconomic Analysis of the Tax Cuts and Jobs Act, as Passed by the House of Representatives on November 16, 2017, JCX-66-17
Treasury Office of Tax Policy Analysis of Growth and Revenue Estimates Based on the U.S. Senate Committee on Finance Tax Reform Plan