Tags: Donald Trump | Media Bias | Trump Administration | Trump Tax Reform | budget | deficit | tax cut

WashPost: Trump Tax Plan Could Bust The Budget

Image: WashPost: Trump Tax Plan Could Bust The Budget
President Donald Trump (AP Photo)

By    |   Wednesday, 26 Apr 2017 08:57 AM

The Washington Post warned the Trump administration's tax reform package could go "dangerously astray" if White House officials believe tax-cutting will pay for itself.

"Specifics have been sketchy in the run-up to Wednesday's announcement, in part because administration officials appear to be of different minds," the newspaper said in an editorial.

"But a few details emerged early in the week. The Wall Street Journal reported that [President Donald] Trump wants to reduce the corporate tax rate from 35 percent to 15 percent and the top tax rate on so-called pass-through companies from 39.6 percent also to 15 percent."

The newspaper noted the nonpartisan Tax Policy Center says cutting the corporate rate by that amount would "reduce revenue by $2.4 trillion over a decade" – half of everything the government will spend in fiscal 2017.

"Cutting the tax on pass-throughs, meanwhile, would boost tax avoidance by encouraging people to take wages in the form of lower-taxed pass-through income," the paper said.

"There are several honest ways out of the resulting budget hole: end or limit tax breaks such as the mortgage-interest deduction; raise the rates of other taxes; cut spending; or some combination."

But it warned the dishonest way is to present the hole does not actually exist.

"That was the approach Treasury Secretary Steven Mnuchin appeared to be taking last Thursday: 'The plan will pay for itself with growth,' Mr. Mnuchin said, claiming that the Trump economic program could goose the economy so much that the government would recoup nearly $2 trillion over 10 years," the newspaper wrote.

It noted Mnuchin could be preparing some limits on deductions, but not enough of them.

"As the population ages, the country is already on track to borrow more and squeeze spending for everything except interest on the debt, pensions, and healthcare: national parks, the FBI, defense, schools and more," the newspaper wrote. "It would be the height of imprudence to worsen the problem, whether based on phony math or sheer heedlessness."

The newspaper added Republicans attacked President Barack Obama for not doing enough to cut federal deficits during the eight years he was in office.

"Will they really turn around now and approve a budget-busting tax cut?" the Post said.

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The Washington Post warned the Trump administration's tax reform package could go "dangerously astray" if White House officials believe tax-cutting will pay for itself.
budget, deficit, tax cut, The Washington Post
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2017-57-26
Wednesday, 26 Apr 2017 08:57 AM
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