Tax framework likely not to call for 15 percent corporate rate: report

Tax framework likely not to call for 15 percent corporate rate: report
© Getty Images

The tax framework that key Trump administration officials and GOP leaders are planning to release next week is unlikely to call specifically for a 15 percent corporate tax rate, Politico reported Tuesday.

The framework instead is likely to indicate a corporate rate of 20 percent or less, according to Politico, which cited people familiar with the negotiations.

Republicans all agree that the current 35 percent corporate tax rate should be reduced significantly, but they've been divided over how far to cut the rate.

ADVERTISEMENT

While President Trump has called for a 15 percent corporate rate, both House Speaker Paul RyanPaul Davis RyanHow does the 25th Amendment work? Sinema, Fitzpatrick call for long-term extension of Violence Against Women Act GOP super PAC drops .5 million on Nevada ad campaign MORE (R-Wis.) and Treasury Secretary Steven MnuchinSteven Terner Mnuchin5 things to know about Trump's escalating trade war with China On The Money: Trump signs first 2019 'minibus' spending package | Mueller probing transactions by Russian organizers of Trump Tower meeting | Stocks brush off trade fears On The Money: Cohen reportedly questioned over Trump dealings with Russia | Trump hails economy | Tells workers to 'start looking' if they want a better job | Internal poll shows tax law backfiring on GOP MORE have said in recent days that that rate would be hard to reach. If Republicans want to avoid exploding the deficit, lower rates will need to be offset by eliminating tax preferences and other revenue-raising provisions.

Politico also reported that the framework from the so-called "Big Six" tax negotiators will likely move away from a proposal to allow businesses to immediately deduct the full costs of their investments, known as "full expensing." Instead, the framework may call for allowing businesses to have accelerated write-offs on a short-term basis.

The tax plan House Republicans released last year called for full expensing, and Sen. Ted CruzRafael (Ted) Edward CruzViral video shows O’Rourke air-drumming to the Who’s ‘Baba O’Riley’ after Cruz debate Five takeaways from Cruz, O'Rourke's fiery first debate NY Times, McCabe give Trump perfect cover to fire Rosenstein, Sessions MORE (R-Texas) argued in favor of the idea in a speech last week. But full expensing would be costly, and some businesses would prefer that lawmakers focus on lowering rates.

Americans for Tax Reform President Grover Norquist, who regularly talks with GOP policymakers, said in July that Republicans were debating whether to propose full expensing on a permanent basis or just for three or four years.

A statement that the Big Six released in July called for "unprecedented" capital expensing. When asked about plans on expensing last week, House Ways and Means Committee Chairman Kevin BradyKevin Patrick BradyHouse GOP bill a mixed bag for retirement savers China imposes new tariffs on billion of US goods: report Trump announces tariffs on 0B in Chinese goods MORE (R-Texas) reiterated that goal.

The Big Six includes Ryan, Mnuchin, Brady, Senate Finance Committee Chairman Orrin HatchOrrin Grant HatchKavanaugh accuser agrees to testify next week Judiciary Dems say GOP treating Kavanaugh accuser worse than Anita Hill Dem vows to probe 'why the FBI stood down' on Kavanaugh MORE (R-Utah), Senate Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellDoug Jones to McConnell: Don't 'plow right through' with Kavanaugh Kavanaugh accuser agrees to testify next week GOP, Kavanaugh accuser struggle to reach deal MORE (R-Ky.) and National Economic Council Gary Cohn.