President Trump plans to unveil a tax cut blueprint — not an actual bill —that
would apply a vastly reduced, 15 percent business tax rate not only to
corporations but also to companies that now pay taxes through the personal
income tax code — from mom-and-pop businesses to his own real estate empire,
according to several people briefed on the proposal. Unless you can read the
actual verbiage in a bill there could be a lot of negatives hiding between the
lines.
The package would also increase the standard deduction for
individuals, providing a modest cut for middle-income people and simplifying
the process of filing tax returns, according to people briefed on its details.
That proposal is opposed by home builders and real estate agents, who fear it
would diminish the importance of the mortgage interest deduction. And it is
likely to necessitate eliminating or curbing other popular deductions, a
politically risky pursuit.
According
to sources the plan does not include Mr. Trump’s promised $1 trillion
infrastructure program, two of the people said, and it
jettisoned a House Republican proposal to impose a substantial tax on imports,
known as a border adjustment tax, which would have raised billions of dollars
to help offset the cost of the cuts.
At a White House
press briefing, Press Secretary Sean Spicer casually
announced that Trump’s tax plan will not
protect tax deductions for 401(k) retirement savings accounts:
“The current
plan right now both protects charitable giving and mortgage interest, and that’s it.”
Spicer was doubling
down on a statement from Treasury Secretary Steve Mnuchin at
yesterday’s briefing where he said, “we are going to eliminate on the personal
side all tax deductions other than mortgage interest and charitable
deductions.”
