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)
Reduce Medicare's Coverage of Bad Debt $17, $33, $54
Increase Individual Income Tax Rates on Ordinary Income $570, $1185
Consolidate and Reduce Medicare Payments for Graduate Medical Education at Teaching Hospitals $94, $103
Impose a Surtax on Individuals' Adjusted Gross Income $1051, $1440
Modify Payments to Medicare Advantage Plans for Health Risk $124, $159, $1049
Eliminate or Limit Itemized Deductions $736, $1621, $1910, $3424
Reduce Payments for Hospital Outpatient Departments $6, $8, $157
Raise the Tax Rates on Long-Term Capital Gains and Qualified Dividends by 2 Percentage Points $103
Reduce Payments for Drugs Delivered by 340B Hospitals $15, $74
Eliminate or Modify Head-of-Household Filing Status $76, $209
Eliminate Subsidies for Certain Meals in the National School Lunch, School Breakfast, and Child and Adult Care Food Programs $14
Limit the Deduction for Charitable Giving $324, $348
Reduce Social Security Benefits for High Earners $48, $117, $197
Change the Taxation of Assets Transferred at Death $197, $536
Establish a Uniform Social Security Benefit $283, $607
Eliminate the Tax Exemption for New Qualified Private Activity Bonds $43
Raise the Full Retirement Age for Social Security $95
Expand the Base of the Net Investment Income Tax to Include the Income of Active Participants in S Corporations and Limited Partnerships $420
Require Social Security Disability Insurance Applicants to Have Worked More in Recent Years $60
Tax Carried Interest as Ordinary Income $13
Introduce Means-Testing for Eligibility for VA’s Disability Compensation $384
Include VA's Disability Payments in Taxable Income $235
End VA’s Individual Unemployability Payments to Disabled Veterans at the Full Retirement Age for Social Security $14, $61
Further Limit Annual Contributions to Retirement Plans $187
Eliminate Certain Tax Preferences for Education Expenses $130
Reduce VA’s Disability Benefits for Veterans Who Are Older Than the Full Retirement Age for Social Security $34
Narrow Eligibility for VA's Disability Compensation by Excluding Veterans With Low Disability Ratings $11, $59
Lower the Investment Income Limit for the Earned Income Tax Credit and Extend That Limit to the Refundable Portion of the Child Tax Credit $11
Use an Alternative Measure of Inflation to Index Social Security and Other Mandatory Programs $278
Require People Who Claim the Earned Income Tax Credit and Child Tax Credit to Have a Social Security Number That is Valid for Employment $28
Reduce the Department of Defense's Annual Budget $959
Expand Social Security to Include Newly Hired State and Local Government Employees $149
Cap Increases in Basic Pay for Military Service Members $22
Reduce Tax Subsidies for Employment-Based Health Benefits $521, $697, $965
Replace Some Military Personnel with Civilian Employees $17
Impose a New Payroll Tax $1282, $2540
Stop Building Ford Class Aircraft Carriers $15
Increase the Maximum Taxable Earnings That Are Subject to Social Security Payroll Taxes $728, $1427
Cancel the Long-Range Standoff Weapon $15
Increase the Corporate Income Tax Rate by 1 Percentage Point $136
Reduce Subsidies in the Crop Insurance Program $47
Cancel the Army’s Future Long-Range Assault Aircraft $11
Repeal the "Last In, First Out" Approach to Inventory Identification and the "Lower of Cost or Market" and "Subnormal Goods" Methods of Inventory Valuation $104
Raise Fannie Mae's and Freddie Mac's Guarantee Fees and Decrease Their Eligible Loan Limits $7, $10, $15
Reduce the Size of the Bomber Force by Retiring the B-1B $6
Require Half of Advertising Expenses to Be Amortized Over 5 or 10 Years $83, $177
Eliminate the Add-On to Pell Grants, Which Is Funded With Mandatory Spending $44
Reduce the Size of the Fighter Force by Retiring the F-22 $29
Repeal the Low-Income Housing Tax Credit $69
Establish Caps on Federal Spending for Medicaid $459, $588, $742, $893
Reduce the Basic Allowance for Housing to 80 Percent of Average Housing Costs $17
Tax All Foreign Income of U.S. Corporations at the Full Statutory Corporate Rate $340
Limit State Taxes on Health Care Providers $48, $241, $612
Reduce Funding for International Affairs Programs $187
Impose a 5 Percent Value-Added Tax $2180, $3380
Reduce Federal Medicaid Matching Rates $69, $530, $561
Eliminate Federal Funding for National Community Service $10
Impose a Tax on Emissions of Greenhouse Gases $645, $700, $814, $919
Increase the Premiums Paid for Medicare Part B $510
Tighten Eligibility for Pell Grants $22
Increase Excise Taxes on Motor Fuels and Index Them for Inflation $212
Reduce Medicare Advantage Benchmarks $489
End Enrollment in VA Medical Care for Veterans in Priority Groups 7 and 8 $60
Increase Excise Taxes on Tobacco Products $51
Adopt a Voucher Plan and Slow the Growth of Federal Contributions for Federal Employees' Health Benefits $14, $16
Reduce the Annual Across-the-Board Adjustment for Federal Civilian Employees’ Pay $77
Increase Taxes on Alcoholic Beverages $88, $102
Introduce Enrollment Fees in TRICARE for Life $17
Reduce Selected Nondefense Discretionary Spending $339
Impose a Tax on Financial Transactions $297
Introduce Minimum Out-of-Pocket Requirements in TRICARE for Life $32
Reduce Funding for Certain Grants to State and Local Governments $67
Increase Certain Fees Charged by Citizenship and Immigration Services and Customs and Border Protection by 20 Percent $16
Change the Cost-Sharing Rules for Medicare and Restrict Medigap Insurance $20, $116, $129
Repeal the Davis-Bacon Act $18
Increase Federal Civilian Employees' Contributions to the Federal Employees Retirement System $40
Reduce Spending on Other Mandatory Programs $580
Eliminate Title I Agriculture Programs $49
Limit ARC and PLC Payment Acres to 30 Percent of Base Acres $24
Reduce the Size of the Nuclear Triad $12, $18
Cancel the Army's Future Vertical Lift Aircraft $15
Change the Tax Treatment of Capital Gains From Sales of Inherited Assets $156
Reduce DoD’s Operation and Maintenance Appropriation (Excluding Funding for the Defense Health Program)  $60, $168
Reduce Funding for Naval Ship Construction to Historical Levels  $51
Eliminate Head Start $95
Limit Enrollment in the Department of Agriculture’s Conservation Programs $3, $5, $8
Eliminate Supplemental Security Income Benefits for Disabled Children $103
Link Initial Social Security Benefits to Average Prices Instead of Average Earnings $69, $109
Make Social Security’s Benefit Structure More Progressive $8, $36
Eliminate Eligibility for Starting Social Security Disability Benefits at Age 62 or Later $21
Tax Social Security and Railroad Retirement Benefits in the Same Way That Distributions From Defined Benefit Pensions Are Taxed $459
Increase the Payroll Tax Rate for Medicare Hospital Insurance $878, $1736
Increase the Payroll Tax Rate for Social Security $712, $1406
Impose an Excise Tax on Overland Freight Transport $351
Eliminate the International Trade Administration's Trade-Promotion Activities $3
Raise the Age of Eligibility for Medicare to 67 $15, $22
Convert the Home Equity Conversion Mortgage Program Into a Direct Loan Program $3
Reduce Quality Bonus Payments to Medicare Advantage Plans $18, $94
Convert Multiple Assistance Programs for Lower-Income People Into Smaller Block Grants to States $88, $160, $247
Reduce TANF’s State Family Assistance Grant by 10 Percent $13
Narrow Eligibility for Veterans’ Disability Compensation by Excluding Certain Disabilities Unrelated to Military Duties $4, $33
Cancel Plans to Purchase Additional F-35 Joint Strike Fighters and Instead Purchase F-16s and F/A-18s $13
Modify TRICARE Enrollment Fees and Cost Sharing for Working-Age Military Retirees $11
Cancel the Ground-Based Midcourse Defense System $18
Cancel Development and Production of the New Missile in the Ground-Based Strategic Deterrent Program $24
Reduce Appropriations for Global Health to Their Level in 2000 $57
Eliminate Human Space Exploration Programs $89
Reduce Department of Energy Funding for Energy Technology Development $3, $5, $8, $16
Limit Highway and Transit Funding to Expected Revenues $116
Eliminate the Federal Transit Administration $87
Increase the Passenger Fee for Aviation Security $21
Increase Payments by Tenants in Federally Assisted Housing $21
Reduce Funding for the Housing Choice Voucher Program or Eliminate the Program $9, $125
Include Employer-Paid Premiums for Income Replacement Insurance in Employees’ Taxable Income $342
Tax All Pass-Through Business Owners Under SECA and Impose a Material Participation Standard $163
Increase Taxes That Finance the Federal Share of the Unemployment Insurance System $18
Repeal Certain Tax Preferences for Energy and Natural Resource–Based Industries $2, $6, $8
Impose Fees to Cover the Costs of Government Regulations and Charge for Services Provided to the Private Sector $0, $1, $2, $9, $14
Impose a Fee on Large Financial Institutions $90, $103
Tax Gains from Derivatives as Ordinary Income on a Mark-to-Market Basis $19
Divest Two Agencies of Their Electric Transmission Assets $2
Change the National Flood Insurance Program $1
Tighten Eligibility for the Supplemental Nutrition Assistance Program $8
Reduce Pension Benefits for New Federal Retirees $3
Eliminate the Special Retirement Supplement for New Federal Retirees $5
Eliminate Certain Forest Service Programs $6
Limit the Number of Cities Receiving Urban Areas Security Initiative Grants $1