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1 An Analysis of the President's 2023 Budget 1 (September 13, 2022)

handle is hein.congrec/aysotepts0001 and id is 1 raw text is: On March 28, 2022, the Administration submitted its annual set of budgetary proposals to the Congress.1 In this report, the Congressional Budget Office examines how those proposals, if enacted, would affect budgetary outcomes in relation to CBO's most recent baseline budget projections.2 Those projections extend from 2022 to 2032 and reflect the assumption that current laws governing federal spending and revenues will generally remain in place. CBO's baseline budget projections and its analysis of the President's proposals are based on the agency's economic forecast published in May that reflects developments through early March.3 According to CBO's projections, the President's propos- als would have the following major effects: 1. This analysis does not include the budgetary effects of the amendments to the proposed budget that the Administration submitted to the Congress on June 7, 2022, or the updated estimates contained in the 2023 Mid-Session Review, which the Administration released on August 23, 2022. 2. Earlier this year, CBO issued a report analyzing the budgetary effects of the President's discretionary budget proposals. See Congressional Budget Office, An Analysis of the Discretionary Spending Proposals in the Presidents 2023 Budget (July 2022), www.cbo.gov/publication/57972. This report combines an analysis of the President's policy proposals that affect revenues and mandatory spending with that earlier analysis of the discretionary spending proposals. 3. For CBO's most recent baseline budget and economic projections, see Congressional Budget Office, The Budget and Economic Outlook: 2022 to 2032 (May 2022), www.cbo.gov/ publication/57950. CBO's baseline is intended to provide a benchmark that policymakers can use to assess the potential effects of policy changes on federal spending and revenues and, therefore, on deficits and debt. Federal deficits over the 2023-2032 period would total $13.1 trillion. Measured in relation to the size of the economy, deficits would average 4.2 percent of gross domestic product (GDP) over that period. The cumulative deficit for the 2023-2032 period would be $2.6 trillion smaller than it is in CBO's baseline projections because revenues would be higher and spending lower (see Table 1). As a result of those smaller deficits, federal debt held by the public in 2032-at 102 percent of GDP- would be 7 percent of GDP lower than it is in CBO's baseline projections, though it would still be 3 percent of GDP higher than it was in 2021. Total revenues over the projection period would be $1.7 trillion (or 3 percent) more than they are in CBO's baseline projections. About half of that increase stems from a proposal to raise the corporate income tax rate from 21 percent to 28 percent. = Total outlays over the 2023-2032 period would be $0.9 trillion (or 1 percent) less than they are in CBO's baseline budget projections. Under the President's budget, outlays for discretionary programs would be $1.7 trillion less than projected in the baseline, and net outlays for interest would be $0.3 trillion less; mandatory outlays, however, would be $1.0 trillion more. In total, CBO's estimate of the cumulative deficit over the 10-year projection period under the President's proposals is $1.3 trillion less than the Administration's estimate of $14.4 trillion. That difference is almost entirely attributable to differences in CBO's and the Administration's projections of outlays-particularly mandatory outlays-under current law. Notes: All years referred to in this report are federal fiscal years, which run from October 1 to September 30 and are designated by the calendar year in which they end. Numbers in the text and tables may not add up to totals because of rounding. Supplemental data for this analysis are available on CBO's website (www.cbo.gov/publication/58417), as are previous editions of this report (https://tinyurl.com/3aph9zde). CBO has corrected this report since its original publication. The correction is listed at the end of the report.

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