Trump’s tax cuts ‘largest reform in history’
US PRESIDENT Donald Trump has proposed major cuts to corporation and personal taxes in an overhaul his administration said would spur economic growth and bring jobs and prosperity.
The plan would also reduce investment and estate taxes aimed at the wealthy.
White House economic adviser Gary Cohn said the plan would cut the top income tax rate from 39.6 per cent to 35 per cent.
It would also reduce the number of personal income tax brackets to three from seven. The new tax rates would be 10 per cent, 25 per cent and 35 per cent.
The plan would double the standard deduction for married couples to $24,000 (£18,600), while keeping deductions for charitable giving and mortgage interest payments.
It would also trim other deductions used by high-income Americans, including state and local tax payments. In addition it would repeal the estate tax, the catch-all alternative minimum tax and the 3.8 per cent tax on investment income from President Barack Obama’s health care law.
According to Treasury Secretary Steve Mnuchin it will be the “largest tax reform” in US history.
Mr Mnuchin gave the description during a speech in Washington yesterday morning.
Critics claim it could add $1 trillion to the government’s mounting debts. President Trump has also pledged to massively increase spending on defence and huge infrastructure programmes such as his giant border wall with Mexico.
The president is said to be trying to make good on promises to bring jobs and prosperity to the middle class. White House senior staff have already said that the top corporate tax rate would drop from 35 per cent to 15 per cent under President Trump’s plan.
The proposal faces a massive hurdle in that lower rates would blow a massive hole in the budget over the next decade.
President Trump has refused to release his own tax returns – a common practice among US politicians – amid claims he has used tax loopholes to vastly reduce any payments since the 1990s. Democrats are currently trying to pass legislation in New York to force residents holding high office to release tax returns.
If the bill passes, the state would be required to release the past five years of state tax returns for Mr Trump. It would also ap- ply to other New Yorkers holding specific offices including the state’s two US Senate seats and Democratic Governor Andrew Cuomo, who already voluntarily releases his returns.
Tensions increased in the Korean peninsula after key parts of a contentious US missile defence system were installed. China argues that the US Thaad missile system will destabilise the region.
The Terminal High-Altitude Area Defence system, or THAAD, comes as high-powered US military vessels converge on the Korean Peninsula and North Korea signals possible nuclear and missile testing. North Korea also conducted a massive live-fire artillery drill on Tuesday, a reminder that the South Korean capital Seoul is within range of its guns.