Rep. Thompson on meeting Trump on tax reform

Sep 28, 2017, 00:12
Rep. Thompson on meeting Trump on tax reform

With Senate Republicans' last-ditch attempt at health care reform dead, the GOP is pivoting to another policy arena in which it hopes to find more success.

The so-called Big Six is expected to release an outline for a tax overhaul sometime this week, perhaps on Wednesday.

But the White House is leaving numerous details to the House Ways and Means Committee and the Senate Finance Committee.

"On the individual side, the first thing we're doing is we're creating a larger zero tax bracket", the official said. But it's anyone's guess who will pay those rates.

The poll, sponsored by a nonprofit outside group aligned with House Speaker Paul Ryan, found that almost three-fourths of voters consider tax reform an important priority for lawmakers, with 43 percent calling it a top priority.

For businesses, the plan would cut the tax rate from 35 percent to 20 percent and would allow companies to write off capital spending for at least five years.

Within moments of Trump's remarks, reports emerged that the Republican proposal will raise the standard individual deduction to $12,000 from its current rate of $6,350, and the deduction for a married couple to $24,000, up from $12,700.

Many individual deductions also would be eliminated in an effort to simplify the tax code.

CNN obtained a copy Wednesday of a Republican framework for tax reform that has been in the works for months and will finally be presented Wednesday.

The plan also repeals the estate tax, sometimes referred to as the inheritance or death tax, a tax levied on property transferred from a deceased person to his or her heirs.

Perhaps the most major yet murky shift on the business side is the move from a worldwide tax system to a territorial tax system.

That's partly because lawmakers are also discussing a tax cut for "pass-through" businesses: those which don't pay taxes themselves, but pass their earnings to owners, who then pay tax at their individual rates.

Almost 90 percent of Americans want an overhaul of the tax code - and a simplification in the process, a new poll showed. The proposal also includes a few compromises around divisive issues where the White House, lawmakers and tax groups have clashed. "It will replace the existing, outdated worldwide tax system with a 100 percent exemption for dividends from foreign subsidiaries (in which the USA parent owns at least a 10 percent stake)". Such changes would significantly slash taxes for the top 1 percent of earners, according to Bloomberg.

GOP leaders, including House Speaker Paul Ryan, R-Wis., have said it is impossible to cut the corporate rate to 15 percent without adding too much money to the federal debt. "With significant and meaningful tax reform and relief, we will create a fairer system that levels the playing field and extends economic opportunities to American workers, small businesses, and middle-income families".

As first reported by Breitbart News, the plan would impose a one-time tax on foreign earnings now held overseas by USA multinational corporations.

As part of the transition to this territorial system, profits already overseas will have a onetime tax on those profits.

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