Corporate Tax Cuts Pushing Deficit Up Faster Than Expected
There is growing evidence that last year's corporate tax cuts will increase the federal budget deficit faster and to a greater degree than expected.
Jim Tankersley, New York Times, Seattle Times: "The amount of corporate taxes collected by the federal government has plunged to historically low levels in the first six months of the year, pushing up the federal budget deficit much faster than economists had predicted."
"The reason is President Donald Trump’s tax cuts. The law introduced a standard corporate rate of 21 percent, down from a high of 35 percent, and allowed companies to immediately deduct many new investments. As companies operate with lower taxes and a greater ability to reduce what they owe, the federal government is receiving far less than it would have before the overhaul."
"The Trump administration had said the tax cuts would pay for themselves by generating increased revenue from faster economic growth, but the administration has acknowledged in recent weeks that the deficit is growing faster than it had expected. The Office of Management and Budget (OMB) said this month that it had revised its forecasts from earlier this year to account for nearly $1 trillion of additional debt over the next decade — on average, almost $100 billion more a year in deficits."