In coming weeks and months, President Trump will attempt tax reform more sweeping, consequential and controversial than those of Presidents George W. Bush and Ronald Reagan.
He is betting that commerce and his own political fortunes will soar if he gets his supply-side ideas into the tax code. While his administration and Congress have struggled to follow through on other parts of his agenda, Trump aims to rally support for tax reform by traveling the country, hosting roundtables and bringing industry groups to the White House. He'll also lean on members of Congress hesitant about the size and scope of his ambitions.
The president doesn't have a bill yet, just a few principles. But they're enough to make clear that he agrees with Speaker Paul Ryan and House Republicans about a dramatic, conservative tax overhaul, and is looking to press for more than they are yet comfortable with.
The theory behind Trump's plan is that lower tax rates for individuals and businesses will lead to more work and investment. Combined with a simpler tax code that creates fewer distortions, this will spur fast economic growth.
One man's supply-side tax reform is another man's tax cut for the wealthy. Republican efforts are sure to meet ferocious opposition from Democrats. But others will also oppose Trump. To pay for his rate cuts, Trump will be forced to eliminate scores of tax breaks that benefit specific industries and groups. As drawn up, his plan would be a declaration of war on the housing industry, blue states and any number of other powerful interests.
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05.10.2024