Biggest Tax Cuts Ever? Nice Try, Mr. President



Let’s ask them.

Photographer: Alex Wong/Getty Images

The Tax Cuts and Jobs Act that Republicans hope to pass and have signed into law by the end of the year has been billed by President Donald Trump as "the biggest cuts ever in the history of this country" and attacked by critics as "deficit-exploding." Technically, though, it's not even the biggest tax cut of the past five years.

That honor goes to the American Taxpayer Relief Act of 2012, which was actually signed into law by President Barack Obama on Jan. 2, 2013. It's something of a bogus distinction, given that the act mainly just extended provisions of 2001, 2003 and 2009 tax cuts that were due to expire. That is, it was not so much a tax cut as a prevention of planned tax increases. The same goes to some extent for the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010.

But even with those set aside, the Tax Cuts and Jobs Act still pales in comparison with President Ronald Reagan's 1981 tax cuts and the 1964 cuts generally identified with President John Kennedy,

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and it is a bit smaller than, if you add them together, President George W. Bush's tax cuts of 2001 and 2003.

The Biggest Tax Cuts and Tax Hikes Since 1952

Revenue impact as a percentage of gross domestic product*

Sources: U.S. Treasury Office of Tax Analysis, Joint Committee on Taxation, Congressional Budget Office

*One-year estimates for 1964 and 1966 acts, four-year for the rest

The revenue estimates for past tax bills are from Jerry Tempalski of the Treasury Department's Office of Tax Analysis, who last updated them in February 2013. They do not attempt to incorporate any economic effects of the tax cuts or tax increases; they're just measures of how big the enacted cuts or increases were. The estimates are also available in current dollars and constant 2012 dollars, but percentage of gross domestic product seemed the best way to compare over time. I only included tax legislation with a revenue impact of 0.5 percent of GDP or more, which is why the landmark Tax Reform Act of 1986, which increased taxes just 0.01 percent of GDP over four years, doesn't show up. For the current tax bills, I used the Joint Committee on Taxation's revenue estimates (again, not incorporating any projected economic effects) and the Congressional Budget Office's most recent GDP forecasts.

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