But when the fiscal year ends, as it just did, we see what really happened. Once again, we see that taxes increased, spending soared even higher, and the deficit grew even more. The tax increases delivered more spending and larger deficits. 


The Congressional Budget Office has released its review of the budget numbers for fiscal 2024, which ended on September 30. Total taxes increased $479 billion, or 11%, to $4.9 trillion, a record high level.  But total spending increased even more, soaring $617 billion to $6.75 trillion. As a result, the budget deficit increased to $1.8 trillion, the third largest budget deficit ever. 

Since 2021, total taxes have increased 22%, up nearly $1 trillion. These tax increases have not reduced budget deficits. Instead, deficits have increased every year for three years in a row as spending increased even more.

In the fiscal year that just ended, individual taxes increased $249 billion to $2.4 trillion, an 11% increase. Corporate tax receipts increased by $109 billion, or 26%, to $529 billion, a record high level. But spending rose to 23.5% of GDP, well-above the previous 20-year average of 22%.

Clearly, we have a spending problem, not a revenue problem. And raising more taxes will not solve the spending problem or reduce the deficits.

Vice President Harris has proposed more than $4 trillion of new tax increases, including raising the corporate tax rate to 28% and increasing the top capital gains tax rate to 33%. Both of those tax increases would reduce investment and economic growth, and potentially lose more revenue than they raise, increasing the budget deficit.

The latest CBO budget review shows that Washington needs to address its spending problem, and that higher taxes will not fix the deficit problem. The next Congress needs to begin to curb the growth of spending and adopt tax policies to encourage long-term economic growth. That’s the best way to deal with the deficit.

Bruce Thompson was a U.S. Senate aide, assistant secretary of Treasury for legislative affairs, and the director of government relations for Merrill Lynch for 22 years.