Trump: Tax re­form is econ­omy’s ‘rocket fuel’

Touts Repub­li­can plan to mid­dle class

The Washington Times Daily - - FRONT PAGE - BY S.A. MILLER

MIDDLETOWN, PA. | Pres­i­dent Trump promised an au­di­ence packed with truck­ers Wednesday that tax cuts will cre­ate jobs and raise wages, mov­ing to blunt the chief crit­i­cism that Repub­li­cans’ pro­posed tax re­forms would be a giveaway to the wealthy at the ex­pense of the mid­dle class.

The pres­i­dent went to the heart of a state that was key to his upset win in Novem­ber to make the ap­peal to blue-col­lar work­ers and small-busi­ness own­ers.

“It will be rocket fuel for our econ­omy,” he said on a stage sur­rounded by huge Amer­i­can flags in a hangar at an Air National Guard base just out­side Har­ris­burg.

Mr. Trump de­scribed the tax cuts as the cen­ter­piece of his eco­nomic plan, which he said was al­ready work­ing. Tax re­form, he said, would kick the econ­omy into over­drive.

“Our coun­try and our econ­omy can­not take off like they should un­less we trans­form Amer­ica’s out­dated, com­plex and ex­tremely bur­den­some tax code,” he said. “It means more jobs, higher pay and lower taxes for mid­dle-in­come fam­i­lies and Amer­i­can busi­nesses of ev­ery size.”

He ac­cused his Demo­cratic crit­ics of mis­rep­re­sent­ing the tax re­form frame­work that will have many de­tails filled in by Con­gress.

He said they “for­got to men­tion” the pro­posed ex­pan­sion of the zero tax bracket, which elim­i­nates taxes on the first $12,000

earned by in­di­vid­u­als and $24,000 earned by mar­ried cou­ples fil­ing jointly.

“They are not telling you the truth. They pre­tend there is not a zero rate, and it is ex­pand­ing sub­stan­tially,” Mr. Trump said.

He also said that in­cen­tives for U.S. companies to bring home prof­its parked over­seas would rip­ple through the econ­omy.

“We will im­pose a one-time low tax on money cur­rently parked over­seas so it can be brought back home to Amer­ica — where it be­longs,” he said. “My coun­cil of eco­nomic ad­vis­ers es­ti­mates that this change, along with a lower tax rate, would likely give the typ­i­cal Amer­i­can house­hold a $4,000 pay raise.”

The White House se­lected Penn­syl­va­nia for the event in part to put pres­sure on two-term Democrat Sen. Robert P. Casey Jr., who is up for re­elec­tion next year. Mr. Trump hopes to pick up a cou­ple of Demo­cratic votes to pad the Repub­li­cans’ thin ma­jor­ity in the Se­nate and avoid the types of fail­ures they suf­fered while try­ing to re­peal Oba­macare.

It was Mr. Trump’s third event in Penn­syl­va­nia since the elec­tion.

He told the crowd that Con­gress mem­bers who op­pose tax cuts would be doomed at the bal­lot box.

“Sadly, the Democrats have be­come ob­struc­tion­ists,” he said. “They want to raise your taxes sub­stan­tially. Open bor­ders and high taxes, that’s not a way to get elected.”

Still, Mr. Casey hasn’t flinched.

Against Trump tax cuts

In a let­ter to the pres­i­dent, Mr. Casey de­nounced the tax plan as a wind­fall for the very wealthy that will make some mid­dle-class fam­i­lies pay more.

“I be­lieve mov­ing for­ward with this par­ti­san pro­posal will be to the detri­ment of work­ing Amer­i­cans across the coun­try who rely on their elected of­fi­cials to ad­vance sound pol­icy that can in­crease wages and cre­ate jobs for our mid­dle-class fam­i­lies,” the se­na­tor wrote.

He cited a re­view by the Tax Pol­icy Cen­ter, a non­par­ti­san Washington think tank, that found 30 per­cent of Amer­i­cans mak­ing $50,000 to $150,000 a year could see a tax in­crease by 2027.

The anal­y­sis also de­ter­mined that 80 per­cent of the ben­e­fits of the pro­posed Repub­li­can re­forms would go to the top 1 per­cent by 2027.

Democrats and other de­trac­tors have been widely cit­ing that fig­ure.

Not One Penny, a coali­tion of lib­eral groups op­posed to the Repub­li­can re­forms, demon­strated against the plan ear­lier out­side the state Capi­tol in Har­ris­burg.

“The vast ma­jor­ity of this money does not go to small-busi­ness peo­ple. It goes to very rich peo­ple, it goes to lawyers,” said Marc Stier, direc­tor of the lib­eral Penn­syl­va­nia Bud­get and Pol­icy Cen­ter.

Se­nate Mi­nor­ity Leader Charles E. Schumer, New York Democrat, said “it would be a mir­a­cle” if the plan helped the mid­dle class.

Mr. Schumer got all but three of his Se­nate Democrats to sign a pledge to op­pose any plan that in­cludes tax cuts for top earn­ers.

Reach­ing out to the base

In his speech, Mr. Trump lauded truck­ers as he­roes.

“Amer­ica first means putting Amer­i­can truck­ers first,” he said.

The pres­i­dent out­lined how truck­ers and truck­ing, the largest em­ployer in ap­prox­i­mately 29 states, will thrive un­der the tax re­forms, say­ing:

● The mid­dle-class tax cut will put money back into their pock­ets, and the sim­pli­fied tax code will save them time and money.

● Tax cuts for man­u­fac­tur­ers will spur busi­ness growth and pro­duc­tion of more Amer­i­can-made goods that truck­ers will be hired to trans­port.

● Drop­ping the top mar­ginal in­come tax rate for small busi­nesses to 25 per­cent will ben­e­fit self-em­ployed truck­ers who of­ten file taxes as passthrough en­ti­ties.

● In­cen­tives for U.S. cor­po­ra­tions to bring home tril­lions of dol­lars parked over­seas to avoid high taxes will con­trib­ute to re­build­ing crum­bling in­fra­struc­ture that truck­ers de­pend on.

The in­vi­ta­tion-only au­di­ence was filled with busi­ness groups, in­clud­ing the Penn­syl­va­nia Man­u­fac­tur­ing As­so­ci­a­tion, the Penn­syl­va­nia chap­ter of the National Fed­er­a­tion of In­de­pen­dent Busi­ness and the Har­ris­burg Regional Cham­ber of Com­merce.

Sev­eral county and state law­mak­ers also at­tended.

Among the Penn­syl­va­nia law­mak­ers ac­com­pa­ny­ing the pres­i­dent was Rep. Lou Bar­letta, who is run­ning for the Repub­li­can nom­i­na­tion to take on Mr. Casey next year.

Mr. Bar­letta was an early Trump sup­porter and is po­si­tion­ing him­self as the Trump can­di­date in the Se­nate race.

“He’s going to win — win big,” Mr. Trump said when in­tro­duc­ing Mr. Bar­letta to cheers from the crowd.

Ahead of the speech, Mr. Bar­letta touted Mr. Trump’s ef­forts to jump­start the Penn­syl­va­nia econ­omy, in­clud­ing the roll­back of Obama-era reg­u­la­tions un­der the En­vi­ron­men­tal Pro­tec­tion Agency.

“The Obama ad­min­is­tra­tion il­le­gally went around Con­gress and passed a pol­icy that would crip­ple Penn­syl­va­nia in­dus­try,” he said. “By rolling back this reg­u­la­tory over­reach, Pres­i­dent Trump again shows he has the backs of hard­work­ing Penn­syl­va­ni­ans.”

GOP tax plan anal­y­sis

Anal­y­sis of the Repub­li­can plan’s im­pact tends to split along ide­o­log­i­cal lines, al­though top earn­ers who pay about 80 per­cent of taxes would reap sub­stan­tial ben­e­fits un­der the cur­rent frame­work.

“I’m quite skep­ti­cal that tax re­forms along the lines of the re­cently an­nounced GOP plan will de­liver no­tice­ably higher job cre­ation or weekly wages,” said Gary Burt­less, an econ­o­mist at the left-lean­ing Brook­ings In­sti­tu­tion who has writ­ten ex­ten­sively about the Rea­gan-era tax re­forms.

“That ear­lier ex­pe­ri­ence does per­suade me, how­ever, that the GOP’s pro­posed tax treat­ment of ‘passthrough en­ti­ties’ will open the door to mas­sive tax avoid­ance for tax­pay­ers who cur­rently face mar­ginal tax rates above 30 per­cent and who have cre­ative tax ad­vis­ers,” he said. “My guess is that ex­ploit­ing the new tax avoid­ance op­por­tu­ni­ties will con­sume a whole lot more tal­ent and ef­fort than the ex­tra ef­fort and in­ge­nu­ity that goes into U.S. busi­ness ex­pan­sion.”

The rate for pass-through busi­ness where own­ers pay taxes at in­di­vid­ual rates and other small busi­ness would get a 25 per­cent rate un­der the Repub­li­can plan.

Gary Cohn, direc­tor of the pres­i­dent’s National Eco­nomic Coun­cil, said the re­forms would in­clude ex­ten­sive safe­guards to pre­vent the wealthy from ma­nip­u­lat­ing the small-busi­ness rates.

Chris Ed­wards, direc­tor of tax pol­icy stud­ies at the lib­er­tar­ian Cato In­sti­tute, vouched for the no­tion that slash­ing cor­po­rate tax rates would boost wages and jobs be­cause busi­nesses have more cap­i­tal to in­vest in new en­deav­ors and fac­to­ries.

He also de­fended the rights of all tax­pay­ers to keep their own money.

“A giveaway to the rich? No way,” he said. “The vast bulk of money that funds the fed­eral gov­ern­ment — in­clud­ing the so­cial pro­grams that lib­er­als love — are funded by those rich peo­ple. They earn the money, then the gov­ern­ment con­fis­cates much of it for hun­dreds of pro­grams that don’t work, harm so­ci­ety or are lousy with waste, fraud and abuse.”

He added that the real in­jus­tice lies with “politi­cians who grab ever more money from high earn­ers, and rather than even say­ing ‘thanks,’ they heap abuse on the tar­gets of their le­gal­ized theft.”

That leaves Amer­i­cans free to pick and choose their tax facts.

In Middletown, re­tired De­fense Depart­ment worker Ken Blouch said he didn’t care how the poor or the wealthy fared un­der the plan.

“As long as the mid­dle class gets some tax break, I’m good with that,” said Mr. Blouch, 64.

AS­SO­CI­ATED PRESS

Pres­i­dent Trump brought his evan­gel of fix­ing tax pol­icy to Har­ris­burg, Penn­syl­va­nia, Wednesday, where he said tax re­form would be “rocket fuel” for the econ­omy.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.