Tax Reform Dead -Tax Cuts Possible and GOP Has No Plan B Without Border Tax

On May 11, 2017 we posted Which of President Trumps Tax Proposals Will Become Law? where we discussed the that the most realistic baseline scenario regarding tax legislation is that

there is a repeal of the ACA and associated taxes. While at this time, it is unclear what a replacement bill may look like.

 

For individuals, expect:  

1. The elimination of the alternative minimum tax,
2. The elimination of the estate and gift taxes
3. An individual tax cut and a collapsing of the current seven tax brackets into three tax brackets as contained in the Ryan blueprint introduced last year. (House GOP. (2016). “A Better Way.” 
4. Reduced capital gains and dividend tax rates

For Corporations: 

1. Lowering the top corporate rate to 30 percent from the current 35 percent, 
2. Capping the top rate on pass-through entities at 25 percent and
3. A permanent reduction in the tax rate for profits from overseas to 8.75 percent for cash and cash-equivalent profits and 3.5 percent on other profits.

Wall Street and corporate America also view President Donald Trump’s bold agenda for a sweeping tax overhaul as largely dead for the year.

Executives, lobbyists and Wall Street analysts increasingly believe the administration, distracted by repeated crises while facing a short and crowded legislative calendar, will be unable to deliver on Trump’s promise to slash corporate and individual tax rates this year and ignite significantly faster economic growth.

“It is just completely unrealistic to think they can get a big tax reform bill done this year,” said Greg Valliere, chief global strategist at Horizon Investments. “They haven’t even agreed whether they are doing tax cuts or tax reform. They haven’t decided if it needs to be paid for or not and I don’t think they appreciate just how big a fight the debt limit is going to be.”

To make matters worse according to Law360,  the GOP Has No Tax Plan B Without a Border Adjustment Tax.

“There’s not a plan B,” Rep. Peter Roskam, R-Ill. said when asked if the House GOP has a backup tax proposal, without border adjustment, in the event the controversial plan proves too toxic to pass.

“2017 is the year,” Roskam said, arguing that if tax reform isn’t passed this year the momentum could be lost. 

 

Need Tax Advice?

 

 

 

Contact the Tax Lawyers at 

Marini& Associates, P.A.  

 

 

for a FREE Tax Consultation

at: www.TaxAid.com or www.OVDPLaw.com or

Toll Free at 888-8TaxAid (888) 882-9243

 

 

 

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