GOP Lawmakers, White House Outline Tax Plan

Saul Bowman
July 30, 2017

Despite this, Ryan said they would keep their plans intact and reform the rest of the tax code.

"The goal is a plan that reduces tax rates as much as possible", the statement said.

Republicans have abandoned what was once their most innovative concept for tax reform, to pay for sharply reduced marginal rates on business through what would have essentially been a tax on the huge USA trade deficit, yielding an estimated $1 trillion over a decade.

Republicans have reiterated that they are committed to passing comprehensive tax reform that lowers rates without creating a new border tax that would shift the burden to consumers.

The 20 percent border adjustment tax included in the "Better Way" tax reform plan proposed past year by House Speaker Paul Ryan, R-Wis., and Ways and Means Committee Chairman Kevin Brady, R-Texas, would effectively move the United States toward a consumption tax structure rather than the current income tax structure.

Ryan told FOX Business he is ready to make concessions, particularly dropping plans for a border adjustment tax, which would have given greater tax preferences to American companies that export goods in comparison to firms that import. President Donald Trump and Congress already are attempting to undo the 2010 health insurance law signed by then-President Barack Obama, finalize a budget and increase the government's borrowing authority.

The six members of the group that's been driving work on the issue are House Speaker Paul D. Ryan, Senate Majority Leader Mitch McConnell, House Ways and Means Committee Chairman Kevin Brady, Senate Finance Committee Chairman Orrin Hatch, Treasury Secretary Steven Mnuchin, and National Economic Council Director Gary Cohn. "So, getting consensus between the White House, the Senate and the House, on a way forward on tax reform makes it that much more of a viable enterprise". We hope they would opt for the former course; though President Trump has called for a new corporate rate as low as 15 percent, down from the current 35 percent, it would only take a smaller reduction, to 25 percent or so, to put the United States back on par with its peers in the advanced industrial world. There's not a complete consensus on how best to do healthcare reform.

"Retailers pay the highest effective corporate tax rate of any sector of the USA economy", Shay said.

Without a new source of revenue, it will make it more hard for Republicans to make tax code changes permanent and deficit-neutral. The discussions largely occurred outside the public eye, but roughly 200 lawmakers were briefed and the administration met with multiple business groups and trade associations on taxes that are largely supportive of the lower rates.

The Trump administration has set a goal of economic growth of 3 percent.

The only way to get to three-percent growth is through tax reform, the speaker said.

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