Trump pitches 'giant, beautiful, massive' tax cut to manufacturers

President Trump on Friday took his campaign for an overhaul of the tax code to manufacturers, arguing that Republicans’ plan will encourage companies to create more jobs in the U.S.

In a speech at the National Association of Manufacturers’s (NAM) board meeting in Washington, Trump called for a “giant, beautiful, massive, the biggest ever in our country, tax cut.”

“We need a tax code that encourages companies to stay in America, grow in America and hire in America,” the president said.

The speech follows Wednesday’s release of a tax framework document by administration officials and key congressional Republicans. The framework is designed to provide guidelines to the congressional tax-writing committees as they finish drafting tax legislation.

The NAM is one of many business groups that came out in favor of the plan, and attendees at the event applauded a number of Trump’s lines throughout the speech.

“With your help and your voice, we will bring back our jobs, we will bring back our wealth, and for every citizen across this land, we will bring back our great American dream,” Trump said.

ADVERTISEMENT

Trump spoke about several aspects of the plan that are of particular importance to manufacturers.

The plan would lower the corporate tax rate from 35 percent to 20 percent, and would lower the rate for so-called pass-through businesses to 25 percent. Pass-throughs, which include everything from small businesses to hedge funds, currently have their income taxed through the individual code, which has a top rate now of 39.6 percent.

Trump said that the rate cut for pass-throughs will result in the lowest top marginal rate for small- and medium-sized businesses in more than 80 years.

“It will be rocket fuel for our economy,” Trump said.

Another aspect of the plan NAM strongly backs is the provision that would allow businesses to immediately write off the costs of their investments for at least five years.

Trump said this provision “means more production, more investment and far more jobs.”

NAM released a survey on Friday that found the highest three-quarter average of manufacturing optimism that the group has recorded. Roughly 64 percent of respondents said that tax reform would make them more likely to expand their business, and about 57 percent said that tax reform would make them more likely to hire more workers.

In a briefing with reporters ahead of the speech, manufacturing leaders said that a tax overhaul in line with the GOP’s framework would help them invest more in their businesses and would also be beneficial for the middle class.

“We are so excited, so optimistic,” said Drew Greenblatt, president and owner of Marlin Steel Wire Products in Baltimore.

The expensing part of the plan would be retroactive to the date of the framework’s release, and Greenblatt said that his company is buying $1 million of new equipment this week to take advantage of the proposal.