Trump sees 'great spirit' for tax reform plan, targets passage by end of the year
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President Trump took his tax pitch to a conservative think tank on Tuesday, arguing that his plan would be a boon to the economy, boosting growth and jobs. Trump spoke at this year’s Heritage Foundation’s President’s Club meeting in Washington. (Oct. 17)
AP
WASHINGTON — President Trump and aides expressed confidence Sunday they have the votes for a major overhaul of the tax system, despite a few warnings from lawmakers about certain aspects of the plan.
“Our economy cannot take off like it should unless we transform our outdated, complex and burdensome tax code, and that is exactly what we are proposing to do,” Trump said in an op-ed for USA TODAY.
In an interview broadcast Sunday on Fox News, Trump said the legislative setbacks suffered by him and Republicans during their efforts to pass a new health care plan won’t affect the prospects of a tax cut.
“I want to get it by the end of the year, but I’d be very disappointed if it took that long,” Trump told Fox Business Network’s Maria Bartiromo.
“So there’s a great spirit for it, people want to see it, and I call it tax cuts. It is tax reform also, but I call it tax cuts. It’ll be the biggest cuts ever in the history of this country,” he said.
In Congress, some Republicans have expressed concern that massive tax cuts would explode budget deficits, while Democrats said they will fight any bill that benefits the wealthy at the expense of the middle class.
Sen. Sherrod Brown, D-Ohio, appearing on CNN’s State of the Union, said Democrats would work with Trump on a tax plan that benefits the middle class and working families but oppose him if he only wants to help rich people. Brown said Trump is at a “fork in the road” when it comes to taxes and relations with Democrats.
Some tax analysts and critics said the Trump team’s emphasis on tax cuts for the wealthy amount to a resurrection of “trickle down economics,” the undemonstrated theory that benefits to high earners will work their way down to the middle and lower classes; they noted that Ronald Reagan’s administration tried the same thing, benefiting mainly the wealthy as federal budget deficts exploded.
Brown told CNN that White House meetings look “far too much like a retreat for Goldman Sachs executives,” and Trump aides keep whispering to him that all they want to do is “trickle-down economics, big tax cuts for the wealthiest people in the country.”
Lawmakers have cited projections that Trump’s proposed tax cuts would increase budget deficits by up to $1.5 trillion over 10 years.
Senate Majority Leader Mitch McConnell, R-Ky., who has long argued that tax reform should be “revenue neutral” and not add to budget deficits, told CNN that growth generated by the tax cuts could would offset deficit increases.
McConnell also avoided commenting of reports that some officials want to reduce the limits on 401(k) contributions, though he predicted a legislative win in the long run.
“We’re going to score a big legislative accomplishment here on tax reform in the near future,” McConnell said on CNN’s State of the Union.
Trump and aides said the elimination of certain tax breaks would be offset by a doubling of the standard deduction to the first $24,000 of annual income.
Some members of Congress, including Rep. Mark Meadows, R-N.C., chairman of the conservative House Freedom Caucus, object to reports that some negotiators are seeking a new top tax rate aimed at very wealthy taxpayers.
Mick Mulvaney, director of the Office of Management and Budget under Trump, told Fox News Sunday that the administration is “agnostic” on the idea of a new top rate and will wait to see what Congress does.
“Look, we want the very best tax package that can actually pass,” Mulvaney said. “And if there’s things the House has to do or the Senate has to do to get that last vote or two to get across the finish line, that’s up to them.”
While Republicans have majorities in the House and Senate, boding well for a package of tax changes, they are hoping to avoid what happened this year with health care. Despite their numbers, Republicans have been unable agree on a plan to repeal and replace President Obama’s health care plan.
While Trump expressed confidence about tax cuts, he also predicted eventual victory on health care.
In his USA TODAY op-ed, Trump said lowering the corporate tax rate would promote economic growth and cutting personal rates would let Americans keep more of their money.
“Our plan will transform the tax code so that it is once again simple, fair and easy to understand,” he said. “We want you to spend your valuable time pursuing your dreams, not trapped in a tax compliance nightmare.”
Read more:
Trump tax strategy: Cut a few compromises but don’t count on Democrats
Senate passes GOP-backed budget in crucial step for Trump’s ambitious tax plan
Senate passes budget plan: What that means for tax cuts, what it doesn’t, what’s next
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