15 percent corporate tax

Trump to propose 15 percent corporate tax rate

By NANCY COOK and BEN WHITE

President Donald Trump is expected to propose slashing the corporate tax rate to 15 percent on Wednesday, as the White House unveils its first stab at a tax plan, according to two sources familiar with the administration’s deliberations.

Cutting the corporate rate to such a low level would allow Trump to follow through on a campaign promise that has been months in the making – even if policy experts argue that getting to that rate is impossible to do without imposing a new levy like a consumption tax, or blowing a hole in the deficit. Trump has been saying since early February that the administration’s release of a tax plan was just weeks away.

A tax cut to 15 percent for corporations is likely to receive a mixed reaction from Congress, which must approve any overhaul of the tax code. Some Republican lawmakers will be thrilled to bring the corporate rate that low as a nod to helping businesses, while others will worry about the proposal’s potential to add to the deficit. Senate Finance Committee Chairman Orrin Hatch (R-Utah) said Monday that a cut to 15 percent could be hard to achieve.

A senior administration official acknowledged that the proposal to cut the rate to 15 percent is just a starting point in negotiations and would likely end up being higher in any final plan approved by lawmakers. The White House expects to negotiate up from there, the official said.

Now, that the 100th day of the administration is fast approaching, White House officials are feeling pressure to show off their accomplishments. A tax plan — even one with broad brushstrokes — is a way for them to signal that the administration is moving ahead with its legislative agenda, despite its failure to repeal and replace Obamacare. The proposal is also intended to show that the White House, and not Capitol Hill lawmakers, will be taking the lead on developing any tax overhaul.

Trump has been talking about the 15 percent corporate rate since August when he delivered a major economic speech in Detroit. Back then, he told supporters: “Under my plan, no American company will pay more than 15 percent of their business income in taxes. Small businesses will benefit the most from this plan.”

The administration’s tax proposal on Wednesday is not expected to be very detailed, or to include ways that Trump would pay for deep tax cuts.