A nonpartisan analysis of the tax President Donald Trump and congressional Republicans put forth estimates the proposal would shrink federal revenues by $2.4 trillion over a decade and that the vast majority of its benefits would go to the wealthiest Americans.
On Sept. 29, the nonpartisan Tax Policy Center released its first analysis of the Trump administration's tax plan. The analysis revealed that the proposal would slash the number of individual tax brackets from seven to three -- almost double the standard deduction -- repeal the estate tax and eliminate the majority of itemized deductions, The Hill reports.
The TPC analysis estimated that the Trump administration's tax proposal would cost the U.S. government budget $2.4 trillion by 2027, and swell to a $3.2 trillion in lost revenue over the following decade.
The analysis found that 80 percent of the proposal's benefits would go to the top 1 percent of American earners, who would see an average of 8.5 percent increase in their income after taxes. Meanwhile, the bottom 95 percent of earners would only see an average increase of 1.2 percent or less to their income after paying taxes.
The tax plan would also result in higher taxes for the middle class after the first decade. After 2027, roughly 30 percent of Americans who make between $50,000 and $150,000 annually would begin to pay more in taxes. Sixty percent of Americans who make $150,000 and $300,000 would also see their taxes rise.
Trump administration Cabinet members have asserted that the tax plan would not primarily benefit the wealthiest Americans. On Sept. 28, White House Chief Economic Adviser Gary Cohn said the plan was designed to benefit middle class earners the most.
"Everything we have done in this tax plan is to solve for the middle class..." Cohn told ABC News. "...We've also said that wealthy Americans are not getting a tax cut."
"...We don't agree with them," Eric Toder, TPC co-director, said of the Trump administration's stance that their tax plan would not primarily benefit the rich, according to The Hill.
The TPC analysis did not factor in how the tax changes could potentially impact the U.S. economy. The nonpartisan think tank plans to release a more comprehensive analysis in the future.
On Sept. 28, Treasury Secretary Steven Mnuchin responded to concerns that the tax plan would blow up the federal deficit.
"Not only will this tax plan pay for itself, but it will pay down debt," Mnuchin said during a conference in the District of Columbia according to Fox Business.
Lily Batchelder, former deputy director of the National Economic Council of the Obama administration deemed Mnuchin's assertion "completely implausible."
"Obviously we need a lot more details to precisely estimate the cost, both before and after taking into account economic growth," Batchelder said. "It is quite clear that this is a very costly plan."