Analysis Deems Biden’s Climate and Tax Bill Fiscally Responsible – The New York Times

“. . . .  The current deal has stripped that spending down to what appears to be somewhere north of $100 billion in climate programs — the exact amount is unclear because the Joint Committee and the Congressional Budget Office have not published a full accounting of the bill’s provisions — and about $100 billion in additional health care spending. That includes three years of enhanced subsidies for people to buy insurance through the Affordable Care Act.

It also includes more money for I.R.S. enforcement, which the Congressional Budget Office projects would more than pay for itself, bringing in more than $100 billion in net additional tax revenue over a decade as the agency became better able to collect the taxes that people and companies already owed.

The Committee for a Responsible Federal Budget estimates that almost all of that spending would be offset over a decade by reductions in federal health care spending spurred by the bill, including the centerpiece effort to allow Medicare to negotiate drug prices.

Both the committee and the University of Pennsylvania’s Penn Wharton Budget Model project that over a decade, the total effect of those changes would reduce federal budget deficits. The committee estimates the savings at just over $300 billion but says they could be even greater if the I.R.S. crackdown works better than the Congressional Budget Office expects. Penn Wharton pegs the deficit reduction at about $250 billion.

Mr. Trump’s tax cuts also contained a mix of tax cuts and tax increases, but with a much different bottom line for the debt. It reduced a wide range of individual and corporate income tax rates, among other tax cuts, while eliminating or capping some tax preferences, like a deduction for paid state and local taxes that the law limited to $10,000 a year.

Some of those tax changes would have been significant tax increases on their own, like eliminating the personal exemption for individual income tax filers. But taken together, they added up to a large tax cut, which the Joint Committee initially estimated at $1.5 trillion on net.”  -30-