President Trump's 2017 Tax Proposal
On April 26, 2017, President Trump issued a proposal for a 2017 Tax Reform for Economic Growth and American Jobs
Outlined in the President’s proposal were four goals for tax reform:
- Grow the economy and create millions of jobs
- Simplify our burdensome tax code
- Provide tax relief to American families – especially middle-income families
- Lower the business tax rate from one of the highest in the world to one of the lowest
The President’s briefly-worded one-page proposal identified a process whereby “throughout the month of May, the Trump Administration will hold listening sessions with stakeholders to receive their inputs and will continue working with the House and Senate to develop the details of a plan that provides massive tax relief…”
President Trump’s proposal for individual tax reform includes reducing the current 7 tax brackets to 3 tax brackets of 10%, 25% and 35%. The current maximum individual tax bracket is 39.6%. The President’s proposal does not identify the proposed income amounts for each of the proposed tax brackets.
The proposal includes doubling the standard deduction. During a press conference given by Steven Mnuchin, Secretary of the Treasury and Gary Cohn, Director of the National Economic Council on the same date as the release of the proposal, Mr. Cohn stated that a married family would not be taxed on the first $24,000 of income.
The proposal also would eliminate the Alternative Minimum Tax.
President Trump’s proposal for business tax reform is a business tax rate of 15%. This is a reduction from the current maximum rate of 35%. Secretary Mnuchin stated that the Trump plan would “have a massive tax cut for businesses and massive tax reform and simplification.” Secretary Mnuchin also stated the “President is determined to unleash economic growth for businesses. This is not just about large corporations. Small and medium-size businesses will be eligible for the business rate as well.”
The general tone of the proposal is to reduce tax liability across the spectrum of taxpayers and reduce the complication of the tax code.
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