US CEOs optimistic on economy, tax reform

NEW YORK: Large US companies remain upbeat on hiring and capital spending, Washington will enact tax reform, the Business Roundtable said Tuesday.

But that positive sentiment is with the second quarter, a decline at risk if the reform fails to mathe organization attributed to terialize. back-to-back hurricanes that have

An index of business sentiment crimped spending. rose to 94.5, up from 93.9, accordThe report comes ahead of ing to a quarterly survey by the what is expected to be a major Washington lobby group, which battle in Congress on tax reform, represents large US companies. Wall Street’s greatest priority for

The economic outlook survey Washington. showed more chief executives The Trump administration still expected to hire workers comhas not outlined a full proposal, pared with the second quarter, although it expected to release but slightly fewer expect to boost details later this month. capital spending. The issue is pivotal to short

Fewer respondents also preterm growth, Business Roundtable dicted increased sales compared President Joshua Bolten said.

“There’s a big opportunity on the table here for the administration and Congress,” Bolten told reporters in a conference call on the survey.

“There’s also a risk. Because there’s a real downside to the US economy if they fail to get tax reform done in a timely fashion.”

Executives are assuming that Washington will enact tax reform and current investment and hiring plans are built on expectations for lower tax rates. So if Washington fails to deliver, the economy could suffer, Bolten said.

Tough lobbying battles are expected on everything from the spending cuts needed to offset the tax reductions, to a bevy of policies that could affect just about every sector, including mortgage lenders, retailers and charitable groups.

Trump has pushed to reduce the corporate rate to 15 percent from 35 percent -- a top rate few companies if any actually pay due to allowed deductions -- but Congress may go for a less generous cut.

Bolten said there is more natural alignment among Republicans in the White House and Congress on tax reform than on health care, which has died repeatedly this year. But he acknowledged there is the package.

“They’ve got some very tough terrain to navigate to get from here to there for a successful tax reform bill,” he said.

“But our members are very optimistic about the prospects and as the survey suggests they are in fact counting on tax reform for their plans for hiring and capital investment.”