>> We will have a massive tax cut for businesses and massive tax reform.>> The biggest tax cut in American history, that's how Treasury Secretary, Steven Mnuchin, is pitching President Trump's tax reform plan. Which would slash rates for businesses and simplify tax returns for individual Americans. The questions abound over how they would make up for the big drop in government revenue.
I'm Andy Sullivan in Washington, where after much fanfare, the White House unveiling the broad outlines of its tax plan, hoping to shape the debate as Congress tries to rewrite the tax code for the first time since 1986. There's broad support for the basic idea, a simpler tax code with lower rates and fewer loopholes, but immediate concern about whether those tax cuts are fair and whether they would balloon the national debt.
Trump's plan would slash the corporate rate from 35% to 15%. Which the White House says would make it more competitive with other countries and encourage multinationals to bring back profits they've parked overseas. Individuals would get tax cuts as well, collapsing the number of brackets from 7 to 3 and doubling the standard deduction.
>> We are gonna eliminate on the personal side all tax deductions, other than mortgage interest and charitable deductions.>> Many of the changes would benefit wealthy taxpayers, people like Donald Trump. The Estate Tax would be eliminated as would the alternative minimum tax that targets more affluent tax payers.
Mnuchin saying the plan wouldn't add to the debt because it would kickstart the economy. People in businesses paying lower rates on higher incomes. It's the classic supply side argument that's been around since the 1980s, met with skepticism on Capitol Hill, among not only Democrats, but Republican deficit hawks as well, who see more red ink in Trump's numbers.
Despite early reports, the plan does not include a tax on imports or other revenue raising elements. So it could force Republicans to choose between their two core principles of lowering the national debt and lowering taxes. Still, the plan getting an initial positive reception from Republicans on Capitol Hill.
House Speaker Paul Ryan stating he likes 80% of what Trump put forward, it's that final 20% that could prove troublesome.