2 years after tax bill’s passage, corporate revenue has plummeted
In December 2017, President Donald Trump signed a massive tax cut for corporations and the wealthy, calling it his “big, beautiful Christmas present” for the American people. While his Treasury Department predicted the cuts would pay for themselves through growth and Trump himself repeatedly promised to eliminate the deficit entirely, the latest budget numbers show these claims were flat-out wrong.
According to a Bloomberg report on Friday, the monthly budget deficit for February was $234 billion — the largest in American history. A year ago, February’s gap was a mere $215.2 billion. A significant part of this gap came from declining revenue, especially from corporations.
Corporate tax revenue so far in 2019 has been just $59.2 billion. Bloomberg noted that, in 2018 as the tax cuts were partially in effect, corporations paid $73.5 billion over a similar time period. In 2017, before the Trump tax cuts, corporate revenue was $87.4 billion at this point in the calendar. This $28.2 million dollar drop-off means that corporate revenue has dropped by almost a third since before the cuts.
The $544.2 billion deficit over the first five months of this fiscal year marks nearly a 40 percent increase from over a year ago. And the national debt, which stands at more than $22 trillion — another all-time record — is over $2 trillion higher than it was when Trump took office.
Trump promised in his 2016 campaign that he would balance the budget “fairly quickly” if elected and vowed not to increase the national debt. “We’ll grow the American economy and all of this will add up to a point where we’re not going to be increasing our debt,” he predicted, suggesting at one point that he could do this in just five years.
Trump even promised to eliminate the entire national debt within eight years, a vow then-budget director and now-acting White House Chief of Staff Mick Mulvaney called “hyperbole” in 2017.
Trump also he said he would not host state dinners until the budget was balanced. In 2018, however, he hosted French President Emmanuel Macron for a state dinner. This week, he announced he would host Israeli Prime Minister Benjamin Netanyahu later this month.