Donald Trump is hoping his golden touch in business will pay off for millions of tax paying Americans. The billionaire real estate mogul unveiled his tax plan on Monday during a press conference at Trump Tower in New York. Under his proposal, Trump says he will lower tax rates for the middle class, simplify the tax code and grow the economy “at a level it hasn’t seen in decades” without adding to the country’s debt.
“It’s a tax reform that I think will make America strong and great again,” said Mr. Trump. “It will be simple, it will be easy, it will be fair, it will be graduated. As you get up in income you pay a little more.”
This is the complete breakdown of Trump’s plan: Individual tax brackets will be consolidated from seven to four: 25%, 20%, 10% and 0%. Singles earning less than $25,000 or married couples earning less than $50,000 will not be required to pay any income tax. According to the Trump campaign, it would reduce taxes to zero for approximately 31 million households. The marriage penalty tax, the alternative minimum tax and the death tax will be eliminated.
Trump also says his proposal will remove or reduce most of the deductions and loop holes available to special interest groups and the “very rich.” It will protect charitable giving, mortgage interest deductions and end the current tax treatment of “carried interest” which allows most investment-fund managers to pay lower taxes on a majority of their compensation. In addition, his proposal will lower the tax rate on all businesses to 15%, down from the current 35% and a one-time 10% tax rate for corporations bringing money back to America from overseas.
The GOP front-runner says in a nutshell, his plan is all about business and job creation.
“This is what I do well, this is my wheelhouse,” said Mr. Trump. “The economy is what I do well.”
Trump added that if he becomes the president he will cut a “tremendous amount” of wasteful government spending and would renegotiate the nation’s trade deals that are currently “not sustainable.”
“We cannot continue to let our jobs go to other countries; there is not a country that we negotiate with that doesn’t make a better deal,“ said Trump. “We are going to negotiate and renegotiate trade deals, military deals, many other deals. That’s going to get the cost down for running our country very significantly.”
Grover Norquist, president of Americans for Tax Reform, weighed in on Trump’s plan on Fox Business’ Varney & Co.
“He took a lot of the good ideas in Congress and moved them down the field quite easily so the Republican House and Senate would pass this bill tomorrow.”
Norquist went on to back Trump’s proposal on Twitter:
Former U.S. Trade Commission Chief Economist Peter Morici also supports Trump’s business tax proposals.
“I love it, it is a great proposal,” said Morici.
“I think this is a great package, we are finally starting to see the truth about Donald Trump. He says a lot of ridiculous and politically incorrect things but let’s face it he is enormously successful in business from thinking about these problems and now we are starting to see him play his strength.”
In comparison to other GOP candidates, Trump’s 15% business tax rate is among the lowest. Rand Paul has proposed a 14.5% flat-tax rate, former Florida Governor Jeb Bush’s plan suggests a 20% top corporate rate and U.S. Senator Marco Rubio says he would tax business income at 25%.
Last month Jeb Bush suggested three individual tax brackets but with slightly higher rates: 28%, 25% and 10%. Rubio and Trump both agree on eliminating the alternative minimum tax and all deductions, support charitable giving and mortgage interest.
According to an NBC News/Wall Street Journal poll out Monday, Donald Trump continues to be the front-runner in the GOP race with 21%. Ben Carson is in second place with 20%, while Carly Fiorina and Marco Rubio are tied in third place with 11% of Republican primary voters support.
Meanwhile, Jeb Bush is at 7%, John Kasich has 6% and Ted Cruz is at 5%. The poll was conducted from Sept. 20-24 among 230 GOP primary voters with a margin of error of plus or minus 6.5 percentage points.