President Donald Trump will propose the largest tax cut in the country's history as a way to spark sustained 3% economic growth, Treasury Secretary Steven Mnuchin said on Wednesday.
Continue Reading Below
The plan calls for 15% tax rates on all businesses, deeper than the rate cuts proposed by House Republicans. Those rates are likely to drive Democrats away and to cause complications in Congress because changes in tax policy that the Senate can pass on a party-line vote under the budget procedure known as reconciliation aren't allowed to create long-run budget deficits.
Mr. Mnuchin said at an event Wednesday morning that the administration wants permanent policy changes but temporary cuts could be considered too.
"This is going to be the biggest tax cut and the largest tax reform in the history of our country," he said at a conference in Washington.
Mr. Mnuchin said the tax proposal would seek to prevent wealthy individuals from taking advantage of the 15% rate for small businesses.
"What this is not going to be is a loophole to let rich people" take advantage of the lower rate, he said, without offering details.
Continue Reading Below
The White House plan, set for release this afternoon, opens monthslong negotiations in Congress.
House Speaker Paul Ryan said Republicans have consensus on the goals and aims for reducing tax rates.
"We're in agreement on 80%, and then that 20%, we're in the same ballpark," the Wisconsin Republican said at a separate event.
Mr. Mnuchin said the administration's proposal won't endorse the border adjustment feature that is central to the House GOP plan. The provision attempts to raise revenue by taxing imports, but not exports. Mr. Mnuchin said the administration wasn't opposed to the provision in concept and that he liked aspects of it. But he said, "We don't think it works in its current form."
Mr. Ryan hasn't backed down on the border adjustment idea, but he said Wednesday that he knows the proposal needs modifications in response to criticism from retailers and others.
"We don't want to have severe disruptions," Mr. Ryan said.
Write to Richard Rubin at firstname.lastname@example.org and Nick Timiraos at email@example.com
(END) Dow Jones Newswires
April 26, 2017 10:00 ET (14:00 GMT)