Trump Says He Will Release Tax Reform Package Next Week
Apr 26 2017 by Elias Hubbard
The committee has been having regular discussions with Treasury and White House officials on a tax overhaul, but was surprised by Trump's statement that a tax plan would be coming on Wednesday, said the person, who asked not to be identified because deliberations are private.
Trump's willingness to let deficits run higher also could hinder the passage of tax cuts that are permanent.
Most outside economic analyses say the type of tax cuts being promoted by Trump would likely fuel even larger deficits for a federal government already projected to see its debt steadily rise.
"The tax plan will pay for itself with economic growth", Treasury Secretary Steven Mnuchin said during a White House press briefing Monday. It would take a number of Democrats to support any tax plan that grows the deficit in the long run because Republicans only have 52 seats in the Senate.
On Wednesday, Trump is expected to sign an executive order related to the 1906 Antiquities Act, which enables the president to designate federal areas of land and water as national monuments to protect them from drilling, mining and development, the source said.
However, as the USA labor market approaches full employment, many economists are concerned that the Trump administration's tax cuts proposal could increase the federal deficit and push up the national debt.
A House Republican tax plan endorsed by House Speaker Paul D. Ryan, R-Wis., for example, would raise almost US$1 trillion by imposing a new tax on imports, frequently referred to as a border-adjustment tax.
"The administration has embarked in a very risky direction", said Edward Kleinbard, the former chief of staff for Congress' Joint Committee on Taxation.
The plan, which would boost revenue by taxing companies' domestic sales and imports, will be left out of Trump's proposal, a senior administration official said.
While many are fearing a rerun of the 2013 shutdown, House speaker Paul Ryan said at the weekend that a Bill would be passed in time to avoid a shut-down on Friday.
"It is an honor to stand with President Trump and Secretary Mnuchin today as we begin the process of reforming our complex tax code and streamlining the financial regulatory process", said Rep. Claudia Tenney. It wouldn't be the best thing possible (I'm still kind of partial to the boss's 9-9-9 plan myself) but lower rates and simpler structures also spur activity and growth. He noted that the USA corporate tax rate is among the highest in the world. Putting in place long-term changes to the tax code would give businesses certainty to help guide their investment decisions, but these sorts of changes to the tax code are much more hard politically as would require bipartisan support. "And now we are hearing the curve ball of a payroll tax cut".
In yet another Wall Street giveaway, President Donald Trump on Friday afternoon took executive action to chip away at Dodd-Frank financial regulations and roll back rules aimed at reducing corporate tax avoidance. "Maybe we end up with 17 1/2 percent". Among the deductions to be eliminated would be the one for the payment of state and local taxes, which would be a big hit to Californians and residents of other states with high taxes and high earners.