Hub financial adviser weighs in on Trump tax plan
Nora Yousif, a financial adviser at RBC Wealth Management in Boston, joined Boston Herald Radio’s “Morning Meeting” program yesterday to talk about President Trump’s audacious plan to reform the tax code.
Q: Can you talk about your insights on tax reform and what Washington should be doing?
A: No legislation is easy, and it’s going to be a laborious process. It’s like making a sausage, I like to say. The process can be pretty ugly but let’s hope some of the product here tastes good. And we’ll see what happens here. People say on the reform part this is much simpler. As Treasury Secretary Steven Mnuchin said, it’s not a matter of life and death. Tax reform is something that has been a talking point for decades. The last time we saw any kind of change was former President (George W.) Bush, who advanced a series of tax cuts in 2001 and ’03 — we really haven’t seen a comprehensive overhaul since 1986.
Q: Can you talk a little bit about what you think would be some good (reforms), that potentially would be easy going for Donald Trump?
A: Let’s see how they make out when it comes to the proposed corporate tax cut because that’s a cut that many people do see agreement on, considering when you look across the globe you see that we have the highest corporate tax rate at 39 percent. The global average is 28 percent and in the last decade other countries have decreased their corporate taxes — so that’s one area that I think he’ll find easier. Another area will of course be the personal income tax cuts. He’s proposing three brackets between 12 and 15 percent as opposed to the tent of 39 1⁄2, which we stand up with now.
Q: He’s gone ahead and given us a preliminary look as to what the tax code would look like, yet Wall Street is not responding in a positive manner. Is there less confidence in Donald Trump after he failed with health care last week?
A: I’m not sure if I would say that. I would say that the market doesn’t like uncertainty. And when they’re sniffing that, ‘Oh gosh. We’ve had some trouble replacing and repealing Obamacare. Oh.’ So maybe there’s some doubt here of the party coming to a consensus, that’s really what the market is responding to. The whiff of doubt of getting things done and them being resolved because, again, the market likes to know what’s going to happen. And the idea of having less taxes, adding more money to corporate and individual’s pockets is positive for the market and that’s really what’s been part of the major Trump bump that we’ve been experiencing since he was elected.