Business guru Steve Forbes predicts that the Trump administration will enact tax cuts by year’s end but the Republican Party has “botched” chances of full tax reform for now.
“We're going to get tax cuts reform means redoing the code,” Forbes told CNBC. He noted that it’s “too late” for full tax reform, saying the GOP “botched that” for now.
“What people want is a vibrant economy. They don't care if Bill Gates gets richer. They want to know is 'Is my paycheck going up?' 'Are my prospects improving?'” said Forbes, author of "Reviving America: How Repealing Obamacare, Replacing the Tax Code and Reforming The Fed will Restore Hope and Prosperity."
“So that's why they've got to do a big tax cut and what they should do, since they've been so dilatory on this, make it retroactive to July 1st or Jan 1st so people get a big refund in April. They see it in the next pay check," said the chairman and editor-in-chief of Forbes Media. "That will put people in a mood. Bill Clinton learned a vibrant economy covers a multitude of sins,” said Forbes, a Republican candidate in the 1996 and 2000 Presidential primaries.
“The prospect of a political disaster next year is going to get these guys to do what they should have done months ago. They will make change on the corporate said, get it down to 20% or so. On the individual side, forget about doing away with tax deduction or local and state taxes and things like,” he said.
“On the individual side, I think you'll see 10% to 15% across the board rates, tax rates like we did in the early '80s and save the heavy lifting on cleaning up the code after next year's election,” he said.
However, Politico has reported that "a tax break popular with homeowners and the real estate industry could take a hit as Republicans look for ways to pay for their tax reform plan."
"Despite promises from the Trump administration in April that it would “protect the homeownership … deductions,” multiple sources tracking tax reform said that the cap on the mortgage interest deduction — currently set at the interest on up to $1 million of mortgage debt — could be lowered in tax reform," Politico has reported.
Meanwhile, White House economic adviser Gary Cohn suggested that the U.S. must cut its corporate tax rate by at least a third to compete with other developed countries.
Cohn’s comments during a Bloomberg TV interview Friday may signal President Donald Trump’s call for a 15 percent corporate rate — which would represent a far larger cut — is a starting point for negotiations as the administration and congressional tax writers begin drafting legislation.
Cohn highlighted the importance of getting the current 35 percent U.S. corporate rate more in line with the average rate among countries in the Organisation for Economic Co-operation and Development, which is about 23 percent. A White House tax outline released in April had set the 15 percent goal for corporations and pass-through businesses.
(Newsmax wires services contributed to this report).
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