The White House has revealed President Trump’s plans to overhaul the U.S. tax system.
The President has called for sharply lower tax rates for both individuals and businesses, while also eliminating some major tax breaks.
The details were deliberately left vague as changing the tax code will be full of political landmines for both parties. But, the outline presented by the President’s program has some politically and economically appealing features for everyone.
The bottom line is that the plan would result in a reduction of the tax rate for virtually everyone. According to The Washington Post, the individual tax brackets would be reduced from seven to three. There would be three rates: 10 percent, 25 percent, and 35 percent. Some itemized deductions would be eliminated, but the standard deduction would be doubled.
The plan would lower the corporate tax rate from 35 percent to 15 percent. The plan would also provide for a one-time tax “holiday” to allow U.S. corporations to bring home several trillion dollars that are currently held overseas.
We expect that trillions of dollars will come back on shore and will be reinvested here in the United States, for capital goods and job creation.
— Steven Mnuchin – U.S. Secretary of Treasury
The tax program put forth by the President is an exciting concept and one that holds great promise of winning approval.