Mnuchin: White House working on new tax package to 'fuel the economy'

Mnuchin: White House working on new tax package to 'fuel the economy'
© Greg Nash

The White House is working on a new tax-cut package focused on boosting economic growth, Treasury Secretary Steven MnuchinSteven MnuchinThe Hill's Morning Report - Presented by Alibaba - Biden jumps into frenzied Dem spending talks Former Treasury secretaries tried to resolve debt limit impasse in talks with McConnell, Yellen: report Menendez, Rubio ask Yellen to probe meatpacker JBS MORE said Thursday.

"The president has asked us to start working on what we call 'tax 2.0,'" Mnuchin said in a CNBC interview in Davos, Switzerland, site of the World Economic Forum. "That will be additional tax cuts that fuel the economy."

Mnuchin's comments come after President TrumpDonald TrumpMcAuliffe takes tougher stance on Democrats in Washington Democrats troll Trump over Virginia governor's race Tom Glavine, Ric Flair, Doug Flutie to join Trump for Herschel Walker event MORE told The Wall Street Journal earlier this week that he expected a new tax package to be unveiled in the next 90 days. Trump said that passage of the proposal would be contingent on him winning reelection this year and Republicans keeping control of the Senate and winning back the House.

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Trump in 2017 signed a broad package of tax cuts for individuals and businesses and frequently touts those cuts to highlight the overall strength of the economy.

But Democrats think that taxes is a winning issue for them, since Trump's law has not become popular with the public and polls show support for Democratic proposals to raise taxes on the rich.

Mnuchin did not provide details about what the new Trump tax proposal would look like, other than that it would include tax cuts for the middle class and other incentives to fuel growth.

"I think the president feels that we need to continue to incentivize the middle class, that their taxes have been too high historically," the Treasury secretary told CNBC. "We had big tax cuts already, and that's an area we'll continue to look at."

The talk of a new round of tax cuts comes as the deficit has increased under Trump's presidency and is projected to exceed $1 trillion in fiscal 2020.

Mnuchin said he maintains his position that the 2017 tax law will pay for itself, though economists across the ideological spectrum disagree. He said that there has been increased government spending as part of bipartisan budget agreements, and "we need to slow down the rate of growth of government spending."