One of the most consistent policy promises President Donald Trump made on the campaign trail to the White House was slashing corporate taxes to 15%. Now, it seems like Republicans are backing off that goal as they prepare to unveil their plan to overhaul the tax code.
In a forum discussion with The New York Times, House Speaker Paul Ryan said the “goal” for the corporate tax rate is now in the mid- to low 20s, making no mention of the 15% Trump and other Republicans have suggested.
“The numbers are hard to make that work. He obviously wants to push this as low as possible and I completely support that, but at the end of the day we got to make these numbers work,” Ryan said. “I think our goal is to be at or below the industrial world average, and that’s 22.5%. So our goal is to get in the mid- to low 20s.”
This is a reversal form Trump’s original promise of 15% during the campaign.
Trump’s tax plan, released in 2015, said “no business of any size, from a Fortune 500 to a mum and pop shop to a freelancer living job to job, will pay more than 15% of their business income in taxes.”
And the one-page statement of principles from the White House released in April said the corporate rate would be 15%.
Reports in recent weeks have indicated, however, that many of the congressional and White House staffers working on tax reform have realised that to make their plan work without blowing out the federal deficit and making it toxic for many lawmakers, the corporate rate would likely have to end up a bit higher.
Trump’s top economic adviser, Gary Cohn, would not guarantee a 15% rate during an interview with the Financial Times on August 25. Cohn, when directly asked about the 15% number, only said the president wanted rates “as low as possible.”
Even Trump seemed to soften a bit during a speech on tax reform in North Dakota on Wednesday.
“And we will cut the business tax rate as much as possible,” Trump said. “Ideally, we would like to bring our business tax rate down to around 15%. That’s a tremendous drop.”
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