Just days before reaching his 100th day in office, President Donald Trump is delivering a gift to taxpayers.
Far from aiding the economy and paying for itself over time, Trump's tax plan would increase the size of the federal deficit, The NYT editorial board said. But especially on the business side, Trump's plan lacks numerous details needed to make the numbers work.
"I'm going to let the president decide what he's going to do in the future", he said. But one thing is certain: "I would never ever bet against this president".
Trump's plan will cut the income tax rate paid by public corporations to 15 percent from 35 percent and reduce the top tax rate by pass-through businesses, including many small partnerships and sole proprietorships, to 15 percent from 39.6 percent, Mnuchin said. The White House said it would be the "biggest tax cut" in USA history.
"We're going to work closely with Congress to get this done", he continued. Retail stocks rose Wednesday on that news. This change, the Financial Times' Matt Klein points out, will hurt richer people more because they tend to live in high-tax states.
The centrepiece of Mr Trump's package is an overhaul of the corporate tax system-something most policymakers agree is badly needed.
"You ran on a populist agenda but it's wealthy heirs who will pay no taxes", Marr says.
"According to the treasury, 43 percent of corporate tax is paid for by the top 1 percent".
That said, they would still be very expensive for the economy.More news: NFL draft begins tonight at 8
The plan also includes a one-time tax on overseas profits. If it were dedicated to infrastructure spending, it could attract votes from Democrats.
The proposal also eliminates the estate tax - referred to by some opponents as the "death tax" - a levy on property including cash and real estate transferred from deceased individuals to their heirs. To no one's surprise, Trump's "plan" completely eliminates the AMT. "The markets are expecting some kind of a cut".
Mr. Trump, the Treasury Department and the National Economic Council unveiled a bare bones list of changes to the tax code on Wednesday that would do away with several major tax burdens, like the alternative minimum tax and the estate tax, which typically affect only the wealthiest Americans. Apply an 18.5 multiple on those earnings, which is the price-to-earnings ratio that the S&P 500 is trading at for 2017 earnings estimates, and if you believe Trump's tax plan will pass, then the S&P 500 should be trading at 4,689, or 96 percent higher than the 2,387 it closed at on Wednesday. He offered few proposals to offset those losses.
Democrats were much harsher in their appraisal.
Mnuchin argued that the tax cuts would spur faster growth, which, in turn, would produce more tax revenue.
"We feel confident that we can get to at least 3 percent economic growth on a sustained basis", said Mnuchin.
On the flip side, Trump wants to eliminate the deduction for state and local taxes, a big tax break that benefits millions, especially people living in Democratic-controlled states with high local taxes such as New York, New Jersey and California. The AMT is a separate tax calculation meant to ensure that richer people don't avoid paying most or all of their taxes by claiming multiple deductions and credits. Ending it would raise about that much in revenue. He further described Trump's tax proposal as "mathematically impossible".
The No. 2 Democrat in the Senate, Dick Durbin, attacked the tax proposal and the fact Trump, a wealthy NY real estate developer, had declined to make public his personal tax returns.