Washington (AFP) – US President Donald Trump will roll out a plan to reform America’s tax code Wednesday, a high stakes bid to salvage his agenda and bolster his faltering presidency.
Amid a string of legislative setbacks, Trump teased a “big announcement tomorrow,” when the White House and Republicans will unveil tax reform plans.
“I’ve asked lawmakers in both parties to discuss our framework for tax cuts and tax reform,” Trump said. “It will be a very, very powerful document.”
Trump wants to simplify the thousands-of-pages-long tax code, cut income taxes “not just a little bit, but tremendously” for the middle class, cut the corporate rate to as low as 15% and “bring back trillions of dollars in wealth” from US firms “parked overseas.”
“The jobs will start pouring in from all over the world coming back to our country,” Trump said.
Overhauling the tax system has long been a political Holy Grail for the Republican Party.
But despite Republican control of both chambers of commerce, party officials admit that more modest tax cuts are now the main aim.
Even that may receive some blowback, if the cuts are not paid for and so add to America’s already high deficit.
Tax reform was a major Trump campaign pledge, but has taken on extra importance after his efforts to enact promised healthcare reform and build a border wall stalled.
Trump lamented being “very disappointed by a couple of senators — Republican senators,” who opposed efforts to overturn Obama-era health reforms.
“At some point there will be a repeal on my desk, but we’ll see whether or not that point is now or will it be shortly thereafter. But we are disappointed in certain so-called Republicans.”
Trump has to prove that his White House and Republican majority can get things done, ahead of legislative elections next year.
Failure to do so would sully Trump’s dealmaker image and could also imperil stock market growth, which has been one of the bright spots of his eight month tenure.
IMF chief Christine Lagarde warned Wednesday that the US will fall short of its ambitious economic growth goals unless it can accelerate promised policy changes, including tax reform.
US economists are increasingly worried about risks to the economy, though they see little chance of a recession near term.
The National Association for Business Economists quarterly survey showed 48 percent believe the risks to the economy are weighted to the downside, indicating chances for an economic slowdown,
The Trump administration has said it will push US growth to three percent annually — a rate economists say is unrealistic, given the low US unemployment rate, among other factors.