Washington: US President Donald Trump‘s administration is expected to release the budget plan for the next fiscal year that will extend the Republican-driven tax cuts enacted in 2017, it was reported.
The White House is proposing to continue individual tax cuts through 2035 at a cost of $1.4 trillion, and the budget plan will be unveiled Monday, Xinhua news agency quoted a CNBC report as saying on Sunday.
The fiscal 2021 budget, which runs from October this year through September 2021, projects the deficit will hit $1 trillion this fiscal year and remain at $200 billion after a decade.
The tax overhaul rolled out in 2017 includes corporate tax cuts, which are permanent, and individual tax cuts, which are set to expire in 2025.
Trump and the Republicans have argued that the tax cuts could boost corporate investment and hiring, while Democrats have insisted that the law fueled corporate buybacks and criticized it as a giveaway to the wealthy.
In his State of the Union address on February 4, Trump touted “America’s great economic success”, saying his administration revived the US economy by slashing regulations, enacting tax cuts, and reaching “fair and reciprocal” trade deals.
But Paul Krugman, Nobel laureate and The New York Times columnist, tweeted that the US economy was growing at the cost of a ballooning deficit.
“Trump’s deficitpalooza is giving the economy as much stimulus now as it was getting in 2012, when the unemployment rate was 8 percent,” Krugman said.