President Trump promises to outline his tax proposals on Wednesday, and the big headline in advance is that he wants to cut the corporate tax rate dramatically from 35% to 15% even if that raises the national debt. Here's a look at the ramifications, along with other aspects of what's known about the tax plan:
- Such a tax cut would cost the government an estimated $2 trillion over a decade, though Treasury chief Steven Mnuchin maintains the tax plan would "pay for itself with economic growth." Still, GOP lawmakers worried about the deficit are likely to balk. The Wall Street Journal digs into the political hurdles.
- Reuters predicts Trump also will try to cap the individual rate at 33% and repeal the alternative minimum and real estate taxes. But the story also notes that the surprise rush by Trump to release his plan raises questions of whether this will be genuine tax reform or merely a slew of tax cuts.
- One legislative hitch: If Republicans want to pass permanent tax cuts with only 51 votes instead of a two-thirds majority, they must show that the deficit won't grow over a decade. Which means Trump's cuts would almost certainly be temporary, explains New York magazine.
- House Republican leaders such as Paul Ryan say a tax on imports could raise $1 trillion, easing the impact on the deficit, but Trump seems to have cooled to the idea of the so-called border-adjustment tax, notes the Washington Post. Even factoring in the BAT, Ryan proposed reducing the corporate tax rate to only 20%.
- Trump boasted to the AP that he would deliver what might be the biggest tax cut in history to Americans. Measuring that is not so simple, and the New York Times concludes that Calvin Coolidge is the current president to beat.
- Bloomberg takes note of another comment of Mnuchin's: Trump wants to simplify the tax code to the extent that most people could file their returns on a postcard.
- So which aide has the most influence on Trump in regard to taxes? It's tough to say, but an analysis at MarketWatch is betting on former Goldman Sacs exec Gary Cohn, who is director of the National Economic Council.