The Trump administration's tax overhaul aims to ease burdens for businesses and corporations, but White House National Economic Council Director Gary Cohn says the personal income side is equally as important.
"We are trying to drive the economy, we are trying to drive growth, we are trying to drive more income back into American consumers' pockets. We want to take Washington out of the equation. We want people to keep more of their hard-earned income," Cohn told the FOX Business Network’s Maria Bartiromo.
Under the proposal, individual tax brackets would be reduced from seven to three, taxed at rates of 35%, 25% and 10%. While this simplifies the tax process, Cohn also pointed out how deduction proposals were vital to lower-income families.
"If you take a median income family in America today, they earn between $55,000 and $56,000. We are giving them a standard deduction of $24,000, meaning that they'll have taxable income of about $32,000. They will have an effective tax rate in the mid-single digits. If they have a couple of children, if they get a child tax credit, they could end up having an effective tax rate of about zero," he said.