Budget impact of presidential candidates’ proposals

The University of Pennsylvania’s Penn Wharton Budget Model has analyzed the Democratic and Republican presidential candidates’ major tax and spending proposals based on available details it has available.

It estimates Vice President Kamala Harris’ plans would increase deficits by a cumulative $1.19 trillion from fiscal year 2025 through 2034, not including any impact on revenue from the economic effects.

The pledge to expand the child tax credits has the biggest impact on widening the deficit, which the PWBM estimates at $1.79 trillion. Her other proposals, expanding the earned income tax credit, permanently extending the enhanced Affordable Care Act premium tax credit, and providing down payment assistance to first-time homebuyers, add another $489 billion. Raising the corporate income tax rate to 28% partially offsets these policies’ budget effects, increasing revenue by $1.1 trillion over the decade.

Former President Donald Trump’s proposals would widen the deficit by $5.83 trillion during this period. Extending the individual income tax provisions of the Tax Cuts and Jobs Act has the biggest impact, $3.39 trillion, followed by $1.23 trillion for the pledge to eliminate taxes on Social Security benefits. Extending the business tax provision of the Tax Cuts and Jobs Act and lowering the corporate income tax rate to 15% would increase the deficit by $623 billion and $595 billion, respectively.