White House officials on Wednesday unveiled a dramatic new tax reform plan that Treasury Secretary Steven Mnuchin is calling "the biggest tax cut" in history aimed at jump starting small businesses and putting more money in the pockets of middle-class Americans.
Mnuchin and National Economic Council Director Gary Cohn laid out a "broad brush overview" of the plan to reporters, cautioning that they are still negotiating many of the details with members of Congress.
“What this is about is creating jobs and creating economic growth. And that’s why massive tax cuts and massive tax reform and simplifying the system is what we’re going to do,” Mnuchin told reporters in the White House briefing room.
The pair stressed that the proposal was not aimed solely at aiding the wealthy, despite lowering rates for top earners. President Donald Trump's proposal would lower the top income tax rate from 39.6 percent to 35 percent, along with simplifying seven tax brackets down to three — 10, 25, and 35 percent, Cohn said.
It also will eliminate a number of deductions used by the wealthiest Americans to scale back their dues, while doubling the standard deduction for married couples to $24,000.
The 15 percent corporate tax rate would be a drastic cut from current rate of 35 percent. Mnuchin and Cohn dismissed questions about how the plan could benefit Trump’s real estate firms, saying the plan will spur growth for all sectors of the economy.
“We are now one of the least competitive countries in the world when it comes to corporate tax. So tax reform is long overdue,” Cohn said.
The broad outline of the plan resembles many of the promises Trump made as a candidate.
But the major tax overhaul will be unlikely to have any impact on the status of the release of the president’s own taxes, which Mnuchin said Trump has “no intention” of making public.
Tax reform represents a major test for Trump’s presidency just shy of his 100th day in office. The president so far has few legislative accomplishments, and a stalled tax plan would be another major blow after House Republicans failed to replace the Affordable Care Act.
One potential sticking point will be how to pay for the plan amid concerns over the rising the deficit. Officials cautioned the details are still being worked out, but said a boost in economic growth will help offset a growing deficit.
Earlier in the day the treasury secretary said Congress and the White House are on the same page,
"We've been briefed on what they're going to do and it's basically along exactly the same lines that we want to go. ... We see this as progress is being made and we're moving and getting on the same page," House Speaker Paul Ryan said earlier in the day.
Ryan, Senate Leader Mitch McConnell, and other Republican leaders released a statement after the press conference saying the plan outlined by the White House will serve as "critical guideposts" to fixing the nation's tax code.