Here is the Tax Expenditure Analysis of the FY 2008 Budget submitted yesterday, (Tax expenditures are defined as ‘‘revenue losses attributable to provisions of the Federal tax laws which allow a special exclusion, exemption, or deduction from gross income or which provide a special credit, a preferential rate of tax, or a deferral of liability.’’)  The Top 10 tax expenditures for 2008 (totaling $579.5 billion) are:

1. Employer-Provided Health Insurance Exclusion:  $160.2 billion
2. Home Mortgage Interest Deduction:  $89.4 billion
3. Charitable Deduction:  $56.0 billion
4. Capital Gains Exclusion:  $52.0 billion
5. Employer-Provided Pension Plans:  $48.5 billion
6. 401k Plans:  $44.0 billion
7. Capital Gains Exclusion on Home Sale:  $38.9 billion
8. Step-Up in Basis of Assets at Death:  $35.9 billion
9. State & Local Tax Deduction:  $27.9 billion
10. State & Local Bond Interest Exclusion:  $27.1 billion

Here are the Top 35 tax expenditures, as ranked by the total 2008-2012 projected revenue effect:

[Click on chart to  enlarge.]  For more details about tax expenditure analysis, see Congressional Research Service, Tax Expenditures: Compendium of Background Material on Individual Provisions (Dec. 2006) (Senate Budget Comm. Print 109-072).