Experts weigh in on Trump tax reform

President Trump announced Wednesday plans to carry out a tax reform calling for big corporate rate cuts, a simpler tax code and big increases in standard deductions.

The plan will lower the business rate to 15 percent, down from the current rate of 35 percent.

Renee Ordeneaux, an audit partner at Armanino, said the tax cuts on their face appear positive for lower income families. It also does not include the so-called border adjustment tax preferred by House leaders. We don't want to penalize people. "Very wealthy people can set up phony structuring to make themselves 'self-employed, '" he added. "We are trying to stimulate business investment".

The White House's presentation will be "pretty broad in the principles", said Marc Short, Trump's director of legislative affairs.

However, experts said that the cuts had nearly no hope of progressing in their current form because they would add trillions of dollars to the U.S. debt pile.

Trump would get rid of the 3.8% Medicare surtax that applies to a portion of one's investment income from capital gains, dividends, interest, rental income and annuities.

Mnuchin said the plan would pay for itself through "growth" and closing loopholes, but he didn't offer details.

Asian shares ticked down from a near two-year high on Thursday after a long-awaited United States tax plan failed to inspire investors, though sentiment remains supported by global growth prospects and receding worries about political risks in Europe.

Cohn said he expects a long fight over the measure.

"I'm not convinced that cutting taxes is necessarily going to blow a hole in the deficit", Hatch said. We'll be attacked from the left and we'll attacked from the right. "But one thing is certain".

Still, "I would never, ever bet against this president". "What few details are here overwhelmingly cut taxes for the richest and do little for middle-class Americans and those trying to get there".

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"The challenge in pushing through a tax reform package of substance might well be even tougher", said Mark Hamrick, senior economic analyst for Bankrate.com.

"I hesitate to call it a plan", Hamrick told VOA. Trump now insists the 100-day deadline is meaningless, yet more evidence Trump has learned that being president is really complicated. That may be only a starting point for negotiations, but a tax rate even in the 25 percent range would mean fatter after-tax profits for companies, which could propel their stock prices even further. "Not a surprise that companies leave trillions of dollars offshore", Mnuchin said. But President Trump said he wants to help by reducing the number of tax brackets.

To offset the loss of revenue from lower tax rates and other changes, Cohn and Mnuchin said they were proposing to eliminate virtually all tax deductions that Americans claim, provisions that they argued primarily benefit wealthier Americans.

Perhaps the most contentious plank would enable taxpayers with business income - including those wealthy enough to pay the top tax rate - to instead pay the new 15 percent corporate rate.

"The million-dollar question is how it will affect President Trump himself, because he will not release his tax returns", she said.

USA stocks, which have hit record highs since November partly due to the expectation of business-friendly tax changes, reversed course and erased daily gains on Wednesday. The conclusion? Trump's child care proposals add more complexity to an already confusing system and would disproportionately benefit high-income families, it found.

It is the work of a White House run by a flailing president with a fragile ego who is desperate to see a bump in the polls the next time he turns on Fox News.

"We like it a lot, it puts us on the same page, we're in agreement on 80 percent, and on the 20 percent we're in the same ballpark", said Ryan.

Trump's tax proposal plans to cut corporate tax rate to 15 percent from 35 percent "to make USA businesses the most competitive in the world", Secretary of Treasury Steven Mnuchin told reporters at the White House.


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