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Donald Trump’s landmark tax bill will add $2.4tn to the US debt by 2034, the congressional fiscal watchdog has warned, in the latest blow to the president as he seeks to push the legislation through the Senate.
The Congressional Budget Office said on Wednesday that the legislation — dubbed the “big beautiful bill” by Trump — would extend the budget deficit, despite the administration’s insistence it would lead to a surplus.
The non-partisan estimate comes a day after billionaire Trump backer Elon Musk attacked the bill as a “disgusting abomination”, arguing that it would undo much of the cost-cutting work of his so-called Department of Government Efficiency.
The rising US debt load has caused alarm on Wall Street. The Treasury bond market has grown from roughly $5tn in 2008 to $29tn today as the government has cut taxes while increasing spending.
JPMorgan Chase chief executive Jamie Dimon warned last week that the bond market would “crack” if the country did not get on a more sustainable track.
The bill aims to extend sweeping tax cuts introduced by the president in 2017 while slashing green incentives and cutting social programmes, including Medicaid, which provides healthcare to low-income and disabled Americans. It would also raise the debt ceiling, or limit on government borrowing, by $5tn.
The CBO said on Wednesday that the legislation would reduce tax revenues by $3.75tn, while increasing the number of people without health insurance by 10.9mn.
The bill narrowly passed the Republican-controlled US House of Representatives last month. It faces an uphill battle in the Senate, where several Republican fiscal conservatives have expressed concerns over the size of the bill, and others have raised alarm bells about the cuts to Medicaid.
Trump has insisted that Congress pass the legislation and send it to his desk to be signed into law by July 4.
The president’s Republican party controls the Senate by a 53-47 margin, meaning it can only afford to lose the support of three senators if the bill is to pass the upper chamber of Congress by a simple majority.
The Trump administration has insisted that the bill will trigger an increase in economic growth and tariff revenues, which have not been reflected in estimates of its fiscal impact. Wednesday’s CBO analysis does not include macroeconomic effects, which will be laid out in a later report.
The administration sought to get ahead of the release on Tuesday, with White House press secretary Karoline Leavitt saying the CBO “has been historically wrong” and accusing the watchdog of bias against Republicans.
“Unfortunately, this is an institution in our country that has become partisan and political, and we are very confident in our own economic analyses of this bill. There is $1.6tn in savings,” Leavitt said.
Democrats were quick to seize on Wednesday’s analysis to slam the legislation. “This bill has gone from bad to worse,” said Ron Wyden, the top Democrat on the Senate finance committee.
“If Senate Republicans truly think this bill is the right direction for America, they owe it to Americans to defend it in public instead of ramming it through under the cover of darkness before they even know what it will do to their constituents,” he said.
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