Economist Larry Kudlow says in a new interview that he expects the GOP tax plan signed into law by President Trump to pay for itself, despite estimates to the contrary.
In an interview with radio host John Catsimatidis on AM 970 in New York, the CNBC contributor and informal Trump adviser argued that the tax overhaul is a campaign promise that Trump “never wavered” on delivering.
“He wanted to lower taxes, especially business taxes, he never wavered on that. Neither did Treasury Secretary [Steven] Mnuchin, who worked in the campaign with us, and it’s now come to fruition,” Kudlow said in the interview, which was broadcast Sunday.
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“Trump has ended the war on business. He’s ended the regulatory war. This [tax reform] now ends the punishment of investment,” he added.
Congress passed the GOP tax plan last week, despite a number of hurdles facing Republican lawmakers, including concerns among some about its impact on the nation’s deficit.
Now, Kudlow expects to defy expectations again with predictions that the bill will not add to the deficit but rather “pay for itself.”
“I think this thing is going to pan out better than almost anybody thinks. The deficit is going to be much lower,” Kudlow said. “This thing is going to pay for itself.”
He also predicted an economic growth rate of about “3 to 4 percent,” saying it could spur economic growth in other countries.
Kudlow’s comments run in stark contrast to an analysis released Friday by Congress’s tax scorekeeper, the Joint Committee on Taxation (JCT).
After accounting for macroeconomic effects, the JCT estimated that the Republican plan would reduce federal revenue by $1.07 trillion over 10 years.
That figure was lower than the $1.46 trillion the JCT originally estimated the plan would cost before accounting for growth.