The IMF has urged the US to “urgently” address its mounting fiscal burden, calling on lawmakers to raise taxes to plug the gap.
The fund’s projections showed the debt-to-GDP ratio of the world’s largest economy hitting 140 per cent by 2032 — way past its previous record high — on the back of successive projected fiscal deficits in the coming years. The finding came as part of the IMF’s annual Article IV health check of the US economy.
“Such high deficits and debt create a growing risk to the US and global economy,” the organisation said.
“These chronic fiscal deficits represent a significant and persistent policy misalignment that needs to be urgently addressed.”
The fund said politicians needed to “carefully consider” a range of tax rises, including on people’s incomes for those earning less than $400,000 annually. President Joe Biden has said that group will not pay more tax if he secures a second term in the White House.
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