Photo by Brian Byrnes

According to a report just released by the Congressional Budget Office, the Senate’s comprehensive immigration reform bill – officially, the Border Security, Economic Opportunity, and Immigration Modernization Act – would reduce federal budget deficits by $197 billion over the next decade.

The legislation would increase spending while increasing tax revenue even more, thus yielding overall budgetary savings and smaller deficits. The higher spending would largely go toward refundable tax credits and health care for new residents, while the increased revenue would result from a substantially larger workforce. According to the CBO, immigration reform would grow the population by 10.4 million people by 2023, with 6 million of those new residents participating in the labor force. Those new workers would pay Social Security and Medicare taxes as well as contribute to general income taxes.

Immigration reform would reduce budget deficits by still more in the following decade. Between 2024 and 2033, the CBO projected $700 billion in federal budget savings.

The report assumed that immigration reform would take effect this October. But it’s not at all clear that lawmakers will be able pass the law on such a short timeframe – if history is any guide, of course, politics will arrest the process.