The tax plan, which is expected to be released on Nov. 2, will increase the deficit by $1-3.5 trillion in the first decade and will cost between $2 trillion and $10.6 trillion by 2040.
The study, which relies on the Penn Wharton Budget Model, predicts economic growth in the range of 1.3 to 1.5 percent, far below President Donald Trump's goal of 4 percent growth.
Despite the White House's claims that corporate tax cuts included in the plan would help workers, the study estimated that labor wages would only climb about 1.3 to 1.4 percent over the span of ten years.
Although the White House claimed that the plan’s corporate tax cuts would end up in the hands of workers’, the study implies otherwise, estimating that labor wages would only increase about 1.3 percent to 1.4 percent over the span of ten years, far less than estimated by the White House.
Treasury Secretary Steven Mnuchin said the tax plan would create enough economic growth to completely cover the deficit.
"We’ll create enormous capital investment and enormous jobs and revenues," he said, according to a report in The Atlantic.
Speaker of the House Paul Ryan also disputed claims that the plan would spark a steep increase in the deficit.
"We believe that we'll get faster economic growth," he said, according to Reuters. "We don't anticipate a big deficit effect from this tax reform because we will broaden the base and lower the rates, plug loopholes and get faster economic growth."
With the upcoming midterm elections in 2018, tax reform has become a politically crucial topic for Republicans, who have yet to score a significant legislative victory outside of confirming Justice Neil Gorsuch to the Supreme Court.