Trump’s tax plan could cut rates for wealthy, here’s how they could still pay more

By Taxes FOXBusiness

Gary Cohn on the Trump administration taking on tax loopholes

National Economic Council Director Gary Cohn on President Trump's tax reform plan.

While President Donald Trump committed to middle class tax cuts during a speech in Missouri earlier this week, National Economic Director Gary Cohn said the wealthiest Americans could still see some sort of reduction in rates.

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Cohn told FOX Business on Friday that there “may be a cut,” but added that by trying to eliminate certain loopholes in the tax code, ideally the wealthier would be paying on “a bigger swath” of their income.

“If we lower the rate just a little bit, but have you pay on more of your income, your effective rate is going up,” he explained.

Republicans could face some resistance from Democrats over even a small cut for the wealthiest Americans. House Minority Leader Nancy Pelosi (D-Calif.) called the GOP’s blueprint a “billionaires-first, trickle-down tax scheme” on Wednesday, while Senate Minority Leader Chuck Schumer (D-N.Y.) has indicated Democrats will not vote for any bill that benefits the top 1% of earners.

On Friday, Cohn insisted the emphasis of the tax relief effort will be directed at the middle class and said he hoped for bipartisan support. He said a key way to even out the playing field for Americans is by eliminating loopholes.

“What the president [has] spent his time on and what we’ve been working on here in the White House is a middle class tax cut,” he said. “[Trump] talked about simplifying the tax system and he talked about getting rid of loopholes. The middle class doesn’t take advantage of the loopholes, the wealthy takes advantage of the loopholes. So when he talks about getting rid of loopholes, he’s talking about areas where the wealthy have used the tax code to their advantage to lower their taxes while the middle class does not have [that same] advantage.”

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Cohn said the administration, at least on the economic side, has been spending “100%” of its time on tax reform. President Trump is expected to meet with the key players involved in crafting tax reform legislation on Tuesday at the White House.

When asked about rumors he is only staying on with the Trump administration to pass tax cuts, the president’s top economic advisor didn’t directly answer the question, but emphatically stated “tax cuts are really important to [him].”

“I think it’s a once in a lifetime opportunity, we haven’t done tax cuts in 31 years,” he said. “So, yes, I’m very excited about being part of that team that is able to work on something that’s that important.”

A source told Fox News last week that Cohn had drafted a resignation letter and met with Trump two weeks ago. While it was unclear whether the president ever received that letter, in an interview with The Financial Times last Friday, Cohn said he felt pressure to quit following the president’s response to the white nationalist protests in Charlottesville, Virginia, and said the Trump administration needed to “do better.”

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