Trump Open to Raising Gas Tax and Negotiating Tax Overhaul Plan
(Bloomberg) -- President Donald Trump said he’s willing to raise the U.S. gas tax to fund infrastructure development and called the tax-overhaul plan he released last week the beginning of negotiations.
“It’s something that I would certainly consider,” Trump said Monday in an interview with Bloomberg News in the Oval Office, describing the idea as supported by truckers “if we earmarked money toward the highways.”
Trump released a tax plan on April 26 that would cut the maximum corporate tax rate to 15 percent from the current 35 percent. The same reduced rate would apply to partnerships and other “pass-through” businesses.
He said he is willing to lose provisions of his tax plan in negotiations with Congress but refused to specify which parts. He also repeated his call for a “reciprocal tax,” which would be aimed at imposing levies on imports to match the rates that each country charges on U.S. exports.
“Everything is a starting point,” Trump said of his tax plan.
The Trump proposal also would eliminate the alternative minimum tax and the estate tax, cut individual income-tax rates and repeal an investment-income tax for high earners, fulfilling a conservative wish list from the past several years.
The one-page plan was silent on both a gas tax or the notion of a reciprocal tax. Trump said he has made no commitments on an increased gas tax but, “it’s something I would certainly consider.”
The nonpartisan Committee for a Responsible Federal Budget released a rough analysis saying the plan could cost $3 trillion to $7 trillion over the next decade -- though White House Budget Director Mick Mulvaney dismissed cost estimates of the plan on CNBC last week, saying there’s not enough detail for accurate projections.
Because the tax legislation would be unlikely to gain Democratic senators’ support, GOP leaders plan to use a procedure that would allow the measure to pass on a simple majority vote. But under that procedure, legislation can’t add to the federal deficit beyond the normal 10-year federal budgeting window.
So unless the tax plan balances any tax cuts with enough revenue-raising measures, such as ending exemptions, deductions and credits, the cuts would have to be temporary, possibly expiring within three years, based on a finding last month by the congressional Joint Committee on Taxation.
“I’d like them to be permanent,” Trump said. “Don’t forget, OK, so here’s something that’s very important. So we’re doing a very big tax cut. We need it.”
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