A new Republican tax bill has added over $3.3 trillion to the national debt over the next 10 years, making it one of the most expensive pieces of legislation in decades. The bill not only includes permanent tax cuts but also introduces new tax breaks, including those for tips and overtime pay. Analysts say that if lawmakers fail to extend expiring tax cuts, the cost will continue to rise.
The bill’s impact on the budget is significant, with some experts estimating the total cost at $5.3 trillion, including interest payments. This would push the debt-to-GDP ratio to over 56% by 2055, making it one of the highest in US history.
The Republican Party’s decision to disregard a Senate rule requiring bills not to add to the debt for more than a decade has raised concerns among lawmakers and economists. The move is seen as an indication that lawmakers are becoming less serious about controlling debt.
Bond markets have already shown signs of stress, with investors expressing disappointment and frustration over the bill’s impact on the national debt. Even without this bill, experts predict that the national debt will continue to rise, reaching record levels in the coming decades.
The looming exhaustion of Social Security’s trust fund in 2033 adds another layer of complexity to the fiscal situation. Experts warn that diminished tax revenue will make finding a fix to the program even more difficult for future presidents. The bill’s impact on the budget is far-reaching and has significant implications for the country’s financial future.
Source: https://www.nytimes.com/2025/07/01/us/politics/republican-policy-bill-perilous-fiscal-path.html