Treasury chief says US can achieve 3 percent economic growth

Goldman sees slimmed-down Trump tax plan in 2018 with smaller cuts less bang for economy

Treasury chief says US can achieve 3 percent economic growth

The House Ways and Means Committee, which writes the nation's tax laws, hosted its first hearing of the year on tax reform, assembling a group of business leaders to testify about the best way to overhaul the tax code and grow the economy. White House controversies - the firing of FBI Director James Comey, reports that Trump leaked highly classified information to the Russians and an allegation that the president asked Comey to end the investigation into his former national security adviser - have dominated political discussions on Capitol Hill, sidelining the GOP's legislative agenda. Instead, GOP members focused on the blueprint they've been pushing for almost a year, the one that includes a border-adjusted business tax.

That is the cardinal sin of President Trump's one-page proposal, released last month, which also would worsen after-tax income distribution. Though Democrats on the committee criticized Trump's plan during the hearing, Republicans were mostly silent.

Ways and Means chairman Kevin Brady just began expert tax hearings.

Out of the 238 House Republicans, only 15 publicly support the measure.

The Republican tax plan would adjust the corporate tax code in several ways. He suggested a 15 percent corporate tax rate, lower rates for pass-through entities, moving to a modern territorial worldwide tax system, maintaining a strong R&D incentive, and a robust capital cost-recovery system.

Every good imported to the USA -from clothing to avocados to automobile parts-would be subject to a BAT tax, and, in turn, consumers would pay higher prices at the check out counter, Nguyen and Hopkins report.

"The problem with a border tax - it's a tax increase", said Rep. Roger Williams, R-Texas, to reporters at an event with the retailer group Americans for Affordable Products, which opposes the border adjustment tax. He also urged tax writers, if they eliminate net interest deduction, to use transition rules "that do not penalize past choices companies made under a vastly different tax system". Or if the proposed solutions to pay for the business rate cuts fall on ordinary people.

The group said the tax would generate $1 trillion in revenue a year for the USA government. President Trump doesn't like the tax, though US Treasury Secretary Steve Mnuchin has signaled that the White House would work with Congress to fix it. The announcement came on the same day a handful of business executives told a congressional committee that the current tax system makes USA companies uncompetitive.

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"I think consumption tax is a good focus". Second, we stand at the precipice of actually passing substantive policy reform that will have an impact for decades to come.

Mnuchin said that the administration's goal is tax relief for the middle class.

Peterson pointed to a need for lower corporate tax rate to level the playing field and increase USA competitiveness internationally. Should rich people pay more? Thus, it's even more important now to sort through the misleading noise surrounding the reform debate so that we keep our eyes on the prize: achieving comprehensive tax reform. The plan, which diverges in key aspects from the White House outline, would lower the corporate tax rate to 20 percent from 35 percent.

In addition to the Trump turmoil, Republicans themselves are not united over the tax plan devised by Ryan previous year.

"We would invest more with immediate expensing", Mr. Stephens said. "That why we talked about trade-offs".

David Farr, the CEO of Emerson Electric, echoed his view: "Yes, I am concerned about the deficit as an individual taxpayer and as CEO, so I look for trade-offs back and forth to make sure we do this right for the economy on a balanced basis".

But the path forward for a successful tax overhaul got no clearer. Any tax-reform plan adopted in the current Congress will "have to be revenue-neutral", Senate Majority Leader Mitch McConnell (R-Ky.) told Bloomberg TV on Tuesday. For a permanent tax cut, the legislation would have to be revenue-neutral and not add to the deficit after 10 years.

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