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Tax Reform Could Spike Federal Borrowing by $3.7 Trillion

5/14/2025

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Committee Proposes Tax Reform

The House Ways and Means Committee is crafting a tax reform bill that could lead to a staggering $3.7 trillion increase in federal borrowing from 2025 to 2034. Aiming to alleviate pressure on high-tax states, it proposes raising the SALT deduction cap to $30,000 for couples earning under $400,000, alongside a significant $4 trillion hike in the debt ceiling.

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IRS Revenue Surges

In a surprising turn of events, the IRS saw a 9% revenue increase from January to April, defying earlier predictions of a 10% drop. Spending surged by 7%, yet the Treasury still managed to raise over $2 trillion, leading to a deficit that was $7.4 billion smaller than the previous year.

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Committee Proposes Tax Reform

The House Ways and Means Committee is crafting a tax reform bill that could lead to a staggering $3.7 trillion increase in federal borrowing from 2025 to 2034. Aiming to alleviate pressure on high-tax states, it proposes raising the SALT deduction cap to $30,000 for couples earning under $400,000, alongside a significant $4 trillion hike in the debt ceiling.

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