President Trump Proposes Cutting Corporate Tax Rate to 15%

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That will happen, according to the Treasury's estimates, because the acceleration of yearly economic growth to 3pc or above will boost tax revenues, and more money will flow into the United States budget at lower tax rates, according to the Laffer curve effect. The President has directed his aides to move quickly on a plan to cut the corporate income tax rate to 15 percent from 35 percent, a Trump administration official said on Monday.

While White House and Congressional staff have been talking since the transition about a tax plan, today's meeting will be the first between Republican Congressional leadership and the key figures driving tax reform in the White House, one Congressional official said.

If Trump doesn't mind adding substantially to deficits, that will undercut efforts by Republican leaders in Congress to make the changes permanent because of complicated legislative rules.

The silver lining here, from the perspective of budget hawks, is that pushing a tax cut for businesses without offsets and adding $200 billion per year to the deficit may be a bridge too far even for numerous most pro-business voices in Congress. Treasury Secretary Steven Mnuchin and National Economic Council Director Gary Cohn will meet with House Speaker Paul Ryan and Senate Majority Leader Mitch McConnell Tuesday evening.

President Donald Trump promised last week to make "a big tax reform and tax reduction" announcement on Wednesday.

Mulvaney said it's "probably fair" to say that details of Trump's tax plan will come in early June.

On Wednesday, The Trump administration is set to announce a "massive" tax plan it hopes to get passed by the end of the year, if not sooner.

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Speaking to The Financial Times last week he argued that a major tax cut could increase government revenue by up to $2tn by increasing growth. But Senate rules now prohibit the passage of any bills that increase the deficit outside the 10-year time frame-which means that Trump's "phenomenal" tax plan would have an expiration date.

The White House decision comes at a crucial time.

Tomorrow's announcement likely will focus on broad tax reform principles such as changes to individual tax rates.

Many economists are skeptical that growth could consistently eclipse 3 percent. This is a problem for Republicans because it means they would need Democratic support in the Senate to pass a tax overhaul that significantly cuts corporate taxes.

According to the report, reforms are also being proposed for the estate and donor's taxes. The bill's author, Rep. Dakila Carlo Cua, also said that it will result in the decrease of tax rates for most taxpayers over the next few years when the package is being implemented. Those in the very top 1 percent - earning about $1.4 million a year or more - are getting most of the country's income growth.

"The gospel is that the government sets goals, and is bureaucratic", said Steven Roth, one of Trump's advisers and CEO of Vornado Realty Trust in NY, said.

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