Macroeconomic Analysis of the Tax Cuts and Jobs Act as Passed by the House of Representatives

The Tax Policy Center has released an analysis of the macroeconomic effects of the Tax Cuts and Jobs Act as passed by the US House of Representatives on November 16, 2017. We find the legislation would boost US economic output by 0.6 percent of gross domestic product (GDP) in 2018, 0.3 percent of GDP in 2027, and 0.2 percent of GDP in 2037. The resulting increase in taxable incomes would reduce the revenue loss created by the legislation by $169 billion from 2018 to 2027 and by $136 billion from 2028 to 2037. Including macroeconomic effects and interest costs, the legislation is projected to increase debt as a share of GDP by just over 5 percent in 2027 and by just over 9 percent in 2037.