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Trump Flip-Flops on Tax Cut Plan

'We don't need it,' he says
By Newser Editors and Wire Services
Posted Aug 22, 2019 1:03 AM CDT
President Trump pauses while speaking with reporters before departing on Marine One on the South Lawn of the White House, Wednesday, Aug. 21, 2019, in Washington. Trump is headed to Kentucky.   (AP Photo/Alex Brandon)
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(Newser) – A day after considering cutting taxes to promote economic growth, President Trump on Wednesday changed course and said he would abandon the idea because the nation already had "a strong economy." Trump's flip-flop came after recent market volatility and economic uncertainty, and amid a debate about whether the United States was heading for a slowdown that would imperil his reelection chances, the AP reports. Trump earlier this week acknowledged, for the first time, that his China trade policies may mean economic pain for Americans, though he insisted the tariffs are needed for more important long-term benefits. But his consideration of cutting payroll taxes appeared short-lived. "I'm not looking at a tax cut now," he told reporters at the White House. "We don't need it. We have a strong economy."

Trump also knocked down the idea of indexing to the capital gains tax, which applies when investors sell assets, to inflation. He said he feared "it will be perceived, if I do it, as somewhat elitist." Analysts have warned that a slowdown, if not full-blown recession, could hit before next year's election. Trump, however, has largely praised the economy's performance and his handling of it. He has often blamed the Federal Reserve—especially Chairman Jerome Powell—and the global slowdown for creating dark clouds at home. "Jay Powell and the Federal Reserve have totally missed the call. I was right and just about everybody admits that," Trump said Wednesday. "He raised interest rates too fast, too furious, and we have a normalized rate. And now we have to go the other direction."

(Read more tax cuts stories.)

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