PWBM’s Efraim Berkovich, the Wharton School’s Marshall Meyer and Mary Lovely of the Maxwell School of Syracuse University discussed how the recently imposed tariffs on Chinese goods are raising prices for consumers, disrupting supply chains and weighing down economic growth in the long-run.
New York Times reporters Ana Swanson and Jim Tankersley compared the revenue generated by tariffs on China with the costs of the trade war to U.S. businesses and consumers. Tariffs on Chinese goods have raised $20.8 billion in revenue. However, President Trump has promised $28 billion to compensate farmers alone. PWBM explains that tariffs raise the price of goods. PWBM’s Richard Prisinzano noted, “The tariffs make all consumers worse off.” In addition, Kent Smetters, PWBM’s Faculty Director, estimated that the tariffs could, “cost the median U.S. household with earnings of $61,000 about $500 to $550 a year.”
On July 12, 2019, Senator Sherrod Brown (D-OH) and Ron Wyden (D-OR) wrote a letter citing PWBM to the Steve Mnuchin, Secretary of the Treasury, to reject a plan to change tax law so that capital gains would be adjusted for inflation. The law change would cut taxes paid on the sale of assets such as stocks, real estate, and other investments. The
In the Congressional Research Service’s report on the economic effects of the 2017 tax bill, Senior Specialist in Economic Policy Jane Gravelle and Specialist in Public Finance Donald Marples analyzed the effects of the Tax Cuts and Jobs Act (TCJA) on output and growth.
The New York Times’ Jim Tankersley cites PWBM in an explanation of how Trump's tariffs erase the benefits of the current tax cuts. In particular, Tankersley finds that the benefits of Trump's tax cuts to the lower and middle classes will likely unwind as a result of his tariffs on goods from China, Mexico, and Europe.
In Trump’s tariffs are equivalent to one of the largest tax increases in decades CNBC’s Steve Liesman analyses data from the Treasury Department to find that tariffs proposed by President Trump will raise $72 billion in revenue. Previously, PWBM has estimated the economic costs of a trade war and that the impact of a trade war could wipe out economic gains from last year’s tax cuts.
Forbes Contributor, Sheila Callahan, covered USAFacts release of its third annual report on May 2, 2019. The report highlighted recent shifts in U.S. demographics, noting that seniors, 65 years and older, are now 16 percent of the population.
CNN reported on the first Tax Day under the Tax Cuts and Jobs Act. Lydia Depillis highlighted key economic effects of the 2017’s Tax Cuts and Jobs Act.
FactCheck.org’s Eugene Kiely explored how to think about the impact of 2017’s Tax Cuts and Jobs Act (TCJA) on tax revenue through official measures of tax receipts. Treasury reports show that in 2018 tax receipts were slightly lower than in 2017. However, tax receipts in February 2019 were 10% higher than in February 2018. Kiely asked PWBM’s Alexander Arnon what these figures mean for future tax receipts.
On March 4, Dylan Moriarty and Richard Rubin presented the Wall Street Journal Tax Calculator, powered by Penn Wharton Budget Model, to help taxpayers understand tax law as they prepare their taxes. Taxpayers only need to enter a few key characteristics such as income and marital status to get an estimate of their tax liability from 2018 to 2027.
The Economist’s print edition, published February 7th, reports that “Some Fights About the Tax Cuts and Jobs Act Seem Over.” Public opinion polls indicate that voters think that “large corporations and rich Americans” are the ones benefiting from the tax law. Meanwhile, policy analysts continue to debate the details.
The New York Times reported Tuesday that the Trump Administration’s “rosy” outlook on the U.S. economy is “increasingly diverging” from economists’ forecasts. The White House predicted that the economy will continue to grow at 3 percent through 2024 (adjusted for inflation), while the Congressional Budget Office (CBO) released their forecasts standing at 2.3 percent for 2019, slowing to 1.7 percent in 2020. Meanwhile, the Federal Reserve’s forecast also predicts 2.3 percent growth in 2019, and Goldman Sachs suggested a more conservative 2.1 percent growth this year based on consumer confidence figures and regional business surveys.
On October 11, 2018, the CNN show, “Quest Means Business” features a heated debate about the recent rate hikes by the Federal Reserve and President Trump’s disapproval of them, in which he cites recent economic growth. Opinion columnist for “The Washington Post”, Catherine Rampell, cites PWBM — alongside the Congressional Budget Office, International Monetary Fund, and Federal Reserve — as finding that the economic boost from the Tax Cuts and Jobs Act is temporary.
Jim Tankersley emphasized how recent tax reform will not pay for itself in his New York Times article, "No, Trump’s Tax Cut Isn’t Paying for Itself (at Least Not Yet)." Even though federal revenues increased marginally in 2018, it will not be enough to cover the tax cut. On October 15th, the Treasury Department announced that despite economic growth and low unemployment, the federal budget deficit grew by 17 percent.
In Yes, the Tax Cuts Have Cost the U.S. Treasury Money Bloomberg’s Justin Fox describes how tax revenue in 2018 is lower than tax revenue in 2017. Over the first six months of 2018, the cost of the Tax Cuts and Jobs Act was generally in line with PWBM’s December projections.
Alan Rappeport and Jim Tankersley of The New York Times cite Penn Wharton Budget Model’s forecast of the fiscal and social effects of adjusting capital gain taxes for inflation in their piece, Trump Administration Mulls a Unilateral Tax Cut for the Rich.