Trump's tax laws and immigration policies increased the deficit by $1.4 trillion

LootboxPhobia · 2026-02-11T16:24:14+00:00

The Congressional Budget Office has revised its deficit forecast for the next ten years upward by $1.4 trillion, mainly due to Trump's tax law and immigration policies. The deficit is expected to increase by $4.7 trillion due to the new fiscal plan, with immigration enforcement adding another $500 billion, and interest expenses also rising significantly.

LootboxPhobia

2026-02-11 16:24:14

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Investing.com – The Congressional Budget Office (CBO) on Wednesday revised upward the U.S. deficit forecast for the next decade by $1.4 trillion, citing President Donald Trump’s 2025 tax and immigration policies as primary factors.

According to the CBO report, the fiscal plan introduced by Trump in July (which extends his 2017 tax cuts and adds new tax incentives) is expected to increase the deficit by $4.7 trillion over the next 10 years. The government’s immigration enforcement actions are projected to add another $500 billion to the deficit.

The CBO warned that despite Trump’s import tariffs increasing revenue, the U.S. remains on an unsustainable fiscal path. Data from Bloomberg Economics indicates that these tariffs have raised the average effective tax rate to over 13%—the highest level since at least the 1940s—and are expected to reduce the deficit by $3 trillion.

Interest payments are also expected to significantly increase the deficit, with net interest expenses projected to rise from $1 trillion in 2026 to $2.1 trillion in 2036. The CBO attributes this surge to large debt levels and higher average interest rates.

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