“The White House unveiled in broad strokes its priorities for tax reform on Wednesday, taking a first step in delivering to investors the corporate tax cuts they’ve been banking on for months, even if there’s still a long way to go before the proposals become law,” Emily Stewart reports for TheStreet.
“President Trump proposed slashing the corporate tax rate to 15% from 35%, as anticipated, and instituting a one-time repatriation tax without specifying the amount,” Stewart reports. “He proposed taxing pass-through businesses at the corporate rate instead of the individual as a measure to help small businesses and called for the individual tax code to be cut down from seven brackets to three.”
“Treasury Secretary Steven Mnuchin said the Trump administration is seeking to make the U.S. corporate tax system the most competitive in the world,” Stewart reports. “‘We will have a massive tax cut for businesses and massive tax reform and simplification,'” he said, adding the White House believes it can boost the GDP to 3% or higher.”
“The Trump plan seeks to reduce the individual tax code to three brackets of 10%, 25% and 35% rates. It will double the standard deduction and eliminate deductions except for mortgages and charitable gifts.,” Stewart reports. “It also repeals the 3.8% Obamacare tax and eliminates the estate tax and alternative minimum tax.”
Read more in the full article here.
MacDailyNews Take: We’ll see where it all ends up (the corporate tax rate won’t end up being 15%, but it may end up being 20-25%, which is certainly better than the stifling 35% it is now).
As we’ve been saying for many years now, the U.S. corporate tax rate is way too high. Obviously.
Under the current U.S. corporate tax system, it would be very expensive to repatriate that cash. Unfortunately, the tax code has not kept up with the digital age. The tax system handicaps American corporations in relation to our foreign competitors who don’t have such constraints on the free flow of capital… Apple has always believed in the simple, not the complex. You can see it in our products and the way we conduct ourselves. It is in this spirit that we recommend a dramatic simplification of the corporate tax code. This reform should be revenue neutral, eliminate all corporate tax expenditures, lower corporate income tax rates and implement a reasonable tax on foreign earnings that allows the free flow of capital back to the U.S. We make this recommendation with our eyes wide open, realizing this would likely increase Apple’s U.S. taxes. But we strongly believe such comprehensive reform would be fair to all taxpayers, would keep America globally competitive and would promote U.S. economic growth. – Apple CEO Tim Cook, May 21, 2013
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