Trump doubles down on 15% corporate tax rate, pressures Congress to act on reform

By Taxes FOXBusiness

Trump: US needs to lower the corporate tax rate to 15 percent

President Donald Trump on why the U.S. needs to lower the corporate tax rate.

During a rally in Springfield, Missouri on Wednesday, President Donald Trump renewed calls for a 15% corporate tax rate amid disagreement among Republicans over whether that level is too low.

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“Ideally … we would like to bring our business tax rate down to 15% … [that] would make us highly competitive,” he said.

A 20 percentage point cut to the current 35% corporate tax rate has been the president’s preference since April, however some lawmakers have argued it is impossible to slash the business rate that significantly without adding to the deficit. The House GOP’s blueprint, approved by House Speaker Paul Ryan (R-Wis.), proposed a 20% corporate tax rate.

Trump laid out other broad principles he hopes to see in the tax reform legislation, including a simplification of the tax code, reducing rates for middle-income Americans, as well as incentivizing companies to bring profits back onshore. Though the details were thin, the message was clear: Congress needs to pass tax reform on behalf of American workers and American companies.

“Today I’m calling on all members of Congress, Democrat, Republican and Independent, to support pro-American tax reform. They have to do it, it’s time,” Trump said. “I’m calling on congress to provide a level playing field for our workers and our companies ... and to put more money into the pockets of everyday hard-working people and also into the pockets of our companies so they can continue to grow and expand.”

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Last week, in an interview with The Financial Times, National Economic Director Gary Cohn delivered a similar message, hinting the administration can only take ideas so far and then it is up to Congress.

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“At the end of the day, tax legislation has to happen in Congress and the House,” he said. “The Ways and Means Committee will be drafting legislation and we will be on the road and holding meetings in Washington and elsewhere explaining why it is so important to have tax reform in America.”

In a tweet, Speaker Ryan insisted Congress was on board with Trump’s vision to jumpstart the American economy by revitalizing the middle class.

While the administration and GOP lawmakers maintain tax reform will be completed by year’s end, some experts believe that could be a challenging task when there is intraparty division on some key provisions. In addition to the corporate tax rate, Republicans are split over whether the tax bill should be revenue neutral.

The White House insists that Trump’s proposed tax cuts will eventually pay for themselves.

Trump is expected to host a meeting on tax reform with key GOP lawmakers on Tuesday.

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