Budget Options

Reports on Budget Options

To help inform lawmakers about the budgetary implications of various approaches to altering federal policies, CBO periodically issues a volume of policy options (called Options for Reducing the Deficit) covering a broad range of issues as well as separate reports that include options for changing federal tax and spending policies in particular areas. The options, which are accessible from this page, are derived from many sources and reflect a range of possibilities. For each option, CBO presents an estimate of its effects on the budget but makes no recommendations. Inclusion or exclusion of any particular option does not imply an endorsement or rejection by CBO. This search is updated regularly to include only the most recent version of a particular option.

Title Latest Estimate 10-Year Savings (Billions)
Consolidate and Reduce Federal Payments for Graduate Medical Education at Teaching Hospitals $34, $40
Limit the Deduction for Charitable Giving $208, $232
Increase Excise Taxes on Tobacco Products $37
Defer Development of the B-21 Bomber $36
Raise Fannie Mae’s and Freddie Mac’s Guarantee Fees and Decrease Their Eligible Loan Limits $10, $30, $36
Introduce Minimum Out-of-Pocket Requirements Under TRICARE for Life $27
Use an Alternative Measure of Inflation to Index Social Security and Other Mandatory Programs $223
Increase the Corporate Income Tax Rate by 1 Percentage Point $99
Replace Some Military Personnel With Civilian Employees $14
Repeal the Davis-Bacon Act $11
Require Social Security Disability Insurance Applicants to Have Worked More in Recent Years $47
Require Earned Income Tax Credit and Child Tax Credit Claimants to Have a Social Security Number That Is Valid for Employment $21
Tax Social Security and Railroad Retirement Benefits in the Same Way That Distributions From Defined Benefit Pensions Are Taxed $459
Increase Federal Civilian Employees’ Contributions to the Federal Employees Retirement System $43
Eliminate Federal Funding for National Community Service $9
Adopt a Voucher Plan and Slow the Growth of Federal Contributions for the Federal Employees Health Benefits Program $21, $24
Eliminate Subsidies for Certain Meals in the National School Lunch, School Breakfast, and Child and Adult Care Food Programs $9
Change the Tax Treatment of Capital Gains From Sales of Inherited Assets $110
Increase Excise Taxes on Motor Fuels and Index for Inflation $237, $512
Reduce the Size of the Bomber Force by Retiring the B-1B $13
Eliminate or Reduce the Add-On to Pell Grants, Which Is Funded With Mandatory Spending $29, $57
Change the Cost-Sharing Rules for Medicare and Restrict Medigap Insurance $33, $60, $92
Increase Individual Income Tax Rates $114, $203, $884
Repeal the “LIFO” Approach to Inventory Identification and the “Lower of Cost or Market” and “Subnormal Goods” Methods of Inventory Valuation $60
Stop Building Ford Class Aircraft Carriers $3
Limit Enrollment in the Department of Agriculture’s Conservation Programs $3, $5, $8
Establish Caps on Federal Spending for Medicaid $353, $472, $485, $561, $636, $683, $787, $959
Eliminate Eligibility for Starting Social Security Disability Benefits at Age 62 or Later $21
Increase the Payroll Tax Rate for Medicare Hospital Insurance $878, $1736
Increase Appropriations for the Internal Revenue Service’s Enforcement Initiatives $41
Eliminate Head Start $95
Eliminate Supplemental Security Income Benefits for Disabled Children $103
Eliminate the Tax Exemption for New Qualified Private Activity Bonds $15
Impose an Excise Tax on Overland Freight Transport $351
Reduce the Size of the Fighter Force by Retiring the F-22 $33
Limit Forgiveness of Graduate Student Loans $6, $15, $27
Increase Premiums for Parts B and D of Medicare $39, $435, $462
Raise the Tax Rates on Long-Term Capital Gains and Qualified Dividends by 2 Percentage Points $75
Require Half of Advertising Expenses to Be Amortized Over 5 or 10 Years $66, $133
Reduce Funding for Naval Ship Construction to Historical Levels  $51
Eliminate Title I Agriculture Programs $39
Limit States’ Taxes on Health Care Providers $32, $176, $429
End VA’s Individual Unemployability Payments to Disabled Veterans at the Full Retirement Age for Social Security $8, $40
Increase the Payroll Tax Rate for Social Security $712, $1406
Reduce the Department of Defense’s Budget $317, $607
Tighten Eligibility for Pell Grants $4, $64
Link Initial Social Security Benefits to Average Prices Instead of Average Earnings $69, $109
Expand the Base of the Net Investment Income Tax to Include the Income of Active Participants in S Corporations and Limited Partnerships $210
Impose a 5 Percent Value-Added Tax $1820, $2220, $2830
Reduce the Basic Allowance for Housing to 80 Percent of Average Housing Costs $15
Reduce or Eliminate Subsidized Loans for Undergraduate Students $7, $19
Reduce Medicare’s Coverage of Bad Debt $21, $43, $69
Eliminate or Modify Head-of-Household Filing Status  $62, $158
Repeal the Low-Income Housing Tax Credit $44
Reduce the Size of the Nuclear Triad $10, $12
Reduce Subsidies in the Crop Insurance Program $29
Reduce Federal Medicaid Matching Rates $57, $500, $529
Reduce VA’s Disability Benefits to Veterans Who Are Older Than the Full Retirement Age for Social Security $25
Increase the Maximum Taxable Earnings for the Social Security Payroll Tax $647, $1024
Reduce DoD’s Operation and Maintenance Appropriation (Excluding Funding for the Defense Health Program)  $60, $168
Reduce the Annual Across-the-Board Adjustment for Federal Civilian Employees' Pay $59
Make Social Security’s Benefit Structure More Progressive $8, $36
Eliminate Certain Tax Preferences for Education Expenses $153
Include Disability Payments From the Department of Veterans Affairs in Taxable Income $113
Impose a Tax on Emissions of Greenhouse Gases $1033
Reduce Funding for International Affairs Programs $117
Reduce or Eliminate Public Service Loan Forgiveness $12, $28
Require Manufacturers to Pay a Minimum Rebate on Drugs Covered Under Part D of Medicare for Low-Income Beneficiaries $148
Eliminate Itemized Deductions $1718
Increase All Taxes on Alcoholic Beverages to $16 per Proof Gallon and Index for Inflation $83, $96
Cancel the Long-Range Standoff Weapon $11
Limit ARC and PLC Payment Acres to 30 Percent of Base Acres $21
Introduce Enrollment Fees Under TRICARE for Life $14
Narrow Eligibility for VA’s Disability Compensation by Excluding Veterans With Low Disability Ratings $6, $38
Expand Social Security Coverage to Include Newly Hired State and Local Government Employees $101
Cap Increases in Basic Pay for Military Service Members $19
Reduce Funding for Certain Grants to State and Local Governments $1, $5, $9, $12, $18, $40
Raise the Full Retirement Age for Social Security $72
Lower the Investment Income Limit for the Earned Income Tax Credit and Extend That Limit to the Refundable Portion of the Child Tax Credit $8
Further Limit Annual Contributions to Retirement Plans $99
Impose a Tax on Financial Transactions $752
Eliminate Funding for Amtrak and the Essential Air Service Program $2, $20
Remove the Cap on Interest Rates for Student Loans $3, $5
Change the Availability of Income-Driven Repayment Plans $-34, $23, $122
Change How Borrowers’ Income-Driven Payments Are Calculated $-6, $-4, $6, $35, $40, $42
Include Employer-Paid Premiums for Income Replacement Insurance in Employees’ Taxable Income $342
Eliminate the International Trade Administration's Trade-Promotion Activities $3
Cancel Plans to Purchase Additional F-35 Joint Strike Fighters and Instead Purchase F-16s and F/A-18s $13
Reduce Funding for the Housing Choice Voucher Program or Eliminate the Program $9, $125
Tighten Eligibility for the Supplemental Nutrition Assistance Program $8
Modify Payments to Medicare Advantage Plans for Health Risk $47, $67
Impose Fees to Cover the Costs of Government Regulations and Charge for Services Provided to the Private Sector $0, $1, $2, $9, $14
Reduce Department of Energy Funding for Energy Technology Development $3, $5, $8, $16
Reduce Tax Subsidies for Employment-Based Health Insurance $256, $438, $638
Convert the Home Equity Conversion Mortgage Program Into a Direct Loan Program $3
Modify TRICARE Enrollment Fees and Cost Sharing for Working-Age Military Retirees $11
End Enrollment in VA Medical Care for Veterans in Priority Groups 7 and 8 $57
Reduce Pension Benefits for New Federal Retirees $3
Reduce Quality Bonus Payments to Medicare Advantage Plans $18, $94
Impose a Fee on Large Financial Institutions $90, $103
Limit Highway and Transit Funding to Expected Revenues $116
Tax All Pass-Through Business Owners Under SECA and Impose a Material Participation Standard $163
Cancel the Ground-Based Midcourse Defense System $18
Reduce the Size of the Federal Workforce Through Attrition $35
Eliminate the Special Retirement Supplement for New Federal Retirees $5
Convert Multiple Assistance Programs for Lower-Income People Into Smaller Block Grants to States $88, $160, $247
Tax Gains from Derivatives as Ordinary Income on a Mark-to-Market Basis $19
Eliminate the Federal Transit Administration $87
Increase Taxes That Finance the Federal Share of the Unemployment Insurance System $18
Cancel Development and Production of the New Missile in the Ground-Based Strategic Deterrent Program $24
Raise the Tax Rates on Long-Term Capital Gains and Qualified Dividends by 2 Percentage Points and Adjust Tax Brackets $70, $76, $81
Eliminate Certain Forest Service Programs $6
Reduce TANF’s State Family Assistance Grant by 10 Percent $13
Divest Two Agencies of Their Electric Transmission Assets $2
Increase the Passenger Fee for Aviation Security $21
Repeal Certain Tax Preferences for Energy and Natural Resource–Based Industries $2, $6, $8
Reduce Appropriations for Global Health to Their Level in 2000 $57
Tax Carried Interest as Ordinary Income $14
Limit the Number of Cities Receiving Urban Areas Security Initiative Grants $1
Narrow Eligibility for Veterans’ Disability Compensation by Excluding Certain Disabilities Unrelated to Military Duties $4, $33
Increase Payments by Tenants in Federally Assisted Housing $21
Change the National Flood Insurance Program $1
Raise the Age of Eligibility for Medicare to 67 $15, $22
Repeal the “LIFO” and “Lower of Cost or Market” Inventory Accounting Methods $58
Eliminate Human Space Exploration Programs $89
Adjust DoD’s and DOE’s Plans for Modernizing Nuclear Forces
Convert Medicare to a Premium Support System
Change FHA’s Exposure to Risk From Single-Family Mortgage Guarantees
Change Federal Civilian Employees’ Contributions to the Federal Employees Retirement System $-79, $-58, $-32, $3, $47
End Congressional Direction of Medical Research in the Department of Defense $9
Scanning and Imaging More Shipping Containers Bound for or Arriving at U.S. Ports
Reduce the Number of Ballistic Missile Submarines $15
Eliminate Grants to Large and Medium-Sized Airports $8
Eliminate Capital Investment Grants for Transit Systems $15
Reduce Federal Funding for the Arts and Humanities $6
Eliminate Exchange Subsidies for People With Income Over 300 Percent of the Federal Poverty Guidelines $109
Restrict Pell Grants to Students Who Meet Academic Progress Requirements $2
Restrict Pell Grants to Students Who Meet More Stringent Academic Eligibility Requirements $3
Consolidate the Department of Defense's Retail Activities and Provide a Grocery Allowance to Service Members $8