UPDATE | Trump proposing 'biggest tax cut' in US history
WASHINGTON (AP) — President Donald Trump is proposing "the biggest tax cut" ever, even as the government struggles with mounting debt, in an effort to fulfill his promises to stimulate job creation and middle class prosperity.
White House officials today were to release broad outlines of a tax overhaul that would provide massive tax cuts to businesses big and small. The top tax rate for individuals would drop by a few percentage points, from 39.6 percent to the "mid-30s," according to an official with knowledge of the plan.
Small businesses would see their top tax rate go from 39.6 percent to the proposed corporate tax rate of 15 percent, said Treasury Secretary Steven Mnuchin in a morning speech.
Mnuchin said the proposed overhaul would amount to "the biggest tax cut" and the "largest tax reform" in U.S. history. He said the lower tax rate for small business owners – a category that under current legal definitions could include doctors, lawyers and even companies such the Trump Organization – would not be used as a loophole for the rich to reduce their tax burden.
But the Treasury secretary declined to say there would be no absolute tax cut for the wealthy, a promise he made last year during a TV interview. "Our objective is simplifying personal taxes," he said.
The plan will not include provisions to increase spending on infrastructure projects, one possible sweetener that could help gain congressional support.
The proposal faces a massive hurdle in that lower rates would blow a hole in the budget, possibly causing the national debt to soar by more than a trillion dollars over a decade.
Without additional revenue sources to offset the tax cuts, the broad proposal would need Democratic support to clear the required 60 votes in the Senate. Congressional Republicans could pass changes on their own with a simple Senate majority, but that would only be temporary under Senate rules.
Mnuchin said he would like the tax overhaul to be permanent, but "if we have them for 10 years, that's better than nothing."