President Donald Trump’s proposed tax plan promises sharp cuts for individuals and big corporations. (Photo by Gage Skidmore)
Just three days shy of his first 100 days in office, President Donald Trump has finally unveiled a blueprint of his tax plan promising a “bigly” reduced 15 percent business tax rate for large corporations and companies that currently pay taxes using the personal income tax code — including his own real estate empire.
Trump’s plan, which has been touted as the largest tax cut in history, would apply sharp tax cuts for individuals and corporate businesses, trimming the number of individual income tax brackets to just three: 10 percent, 25 percent and 35 percent, according to The New York Times. The proposed plan also would double the standard deduction, easing the tax burden on millions of Americans by stamping out taxes on the first $24,000 of a couple’s earnings.
Most itemized tax deductions will be eliminated under the Trump’s plan, but the president has promised to retain favored deductions for mortgage interest and charitable donations. The estate tax and alternative minimum tax would be withdrawn, however, the newspaper reported. The 3.8-percent tax on investment income imposed by former President Obama’s Affordable Care Act would be eliminated as well.
White House chief economic adviser Gary Cohn and Treasury Secretary Steven Mnuchin summarized additional details of the plan during a briefing for reporters at the White House Wednesday, April 26, according to CNBC. The duo announced that there’d be a “one-time tax” on the trillions of dollars held by companies overseas as a way to entice them to re-patriate that money. The rate for that tax hasn’t been determined yet, according to Mnuchin.
The treasury secretary also explained that the U.S. would transition to a “territorial” tax system, which typically excludes most, if not all, of the income that businesses rake in overseas.
The White House provided little details, however, on whether Trump’s plan would result in a larger U.S. deficit. Officials contended the debt would eventually “pay for itself” through economic growth.
Omitted from the plan entirely was the border adjustment tax on imports hailed by Republicans, who expressed support for the so-called territorial tax. Democrats, on the other hand, have denounced Trump’s plan, saying it simply provides more tax cuts for the wealthy.
“Trump’s latest proposal is another gift to corporations and billionaires like himself,” said Tom Perez, chair of the Democratic Party. “Trump must release his tax returns, as millions of Americans are demanding before Congress can consider any Trump tax plan. We must know how much Trump would personally financially benefit from his own proposal.”
Munchin waved off the chairman’s demands Wednesday, reiterating that the president has no intention of releasing his tax returns. He said the White House wanted to move “as fast as we can” to get Trump’s tax plan approved.
It will be “the biggest tax cut and largest tax reform in history of this country.”
