The Senate immigration bill would reduce deficits by $197 billion over 10 years, according to the Congressional Budget Office.
The bill would increase spending by $262 billion between 2014 and 2023, but would increase revenue by $459 billion, according to the non-partisan office.
In the next decade, it would reduce the deficit by $700 billion, CBO said.
The CBO score could give the bill a significant boost as the Senate tries to clear it before the July 4 recess. Supporters are hoping for a strong vote in order to put pressure on House Republicans to pass a bill this year.
The bill requires increased spending on border security and ultimately would provide a path to legal residency and possible citizenship for the nation’s estimated 11 million illegal immigrants. That status would allow immigrant to tap into federal entitlement benefits but they would start paying taxes for the first time as well.
The CBO normally uses a conventional 10-year budget window and this has been a sore point for opponents of the Gang of Eight bill, who had called for a longer-range estimate.
The chief Senate critic of the immigration reform bill, Sen. Jeff Sessions (R-Ala.) last month said the bill will be costly once illegal immigrations qualify for entitlements.
The Heritage Foundation released a report in May projecting the Senate immigration reform bill would cost $6.3 trillion over the “lifetimes” of immigrants put on a 13-year path to citizenship. It totaled federal, state and local expenses and subtracted estimated increases in tax revenue.
The conservative think tank estimates the bulk of those costs would occur after immigrants become eligible for Medicare and means-tested federal welfare programs.
Critics said the analysis made faulty assumptions about the work and earning potential of the immigrants once they are legal.
CBO estimated that the bill requires new appropriations of $22 billion over ten years to implement policies like enhanced border security. If Congress lifts current budget caps to implement the bill, the net deficit reduction is $175 billion over ten years.
CBO estimated that the bill will lead to 10.4 million more permanent residents in the U.S over the next ten years. It said 8 million unauthorized workers would be legalized under the measure. Over 20 years, there would be 16 million more people in the U.S. if the bill passes.