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May 25, 2018 at 01:43 PM
The Congressional Budget Office said Thursday that under President Donald Trump’s 2019 budget, debt will continue to rise, though, as the Center for a Responsible Federal Budget points out, “at a slower rate than under current law.”
As the CBO analysis notes, on Feb. 12, the Trump administration submitted its annual set of budgetary proposals to the Congress; subsequent amendments were transmitted on April 13.
According to CBO’s analysis:
- Federal debt held by the public would equal 86% of gross domestic product (GDP) in 2028 under the president’s budget, compared with 96% that year in the agency’s baseline and about 78% this year.
- The federal deficit would be $2.9 trillion smaller under the president’s budget than in CBO’s baseline during the 2019–2028 period, CBO estimates. By contrast, the administration estimates that the deficit would be $5.2 trillion smaller than the baseline amount during that period.
- The two largest changes over the 2019–2028 period would be a $2.1 trillion reduction in nondefense discretionary spending (excluding that designated for overseas contingency operations, or OCO) and a $1.3 trillion reduction in mandatory spending for health care.
Trump’s proposals would boost mandatory spending on infrastructure programs by $131 billion over the next 10 years, CBO estimates.
Trump also proposes changes to federal student loan programs that would generate $103 billion in savings to the government between 2019 and 2028, CBO estimates. The proposals would make a number of changes to the Federal Direct Loan Program, including creating a single income-driven repayment plan, eliminating loan forgiveness for some borrowers and eliminating subsidized loans.
Trump’s budget plan also suggests the following:
Extend Tax Provisions That Expire in 2025
Trump wants to extend provisions of the individual income tax and the estate and gift tax enacted in the 2017 tax act that are scheduled to expire in 2025 — which include the current statutory tax rates, a higher standard deduction, the repeal of personal exemptions and limits on certain itemized deductions.
