Mnuchin says considering backdating tax cut to Jan. 1: Would be ‘boon’ to economy,
Treasury Secretary Steven Mnuchin said Tuesday the Trump administration is considering backdating tax reform to the start of this year to boost the economy.
Backdating “is still something we are considering and it would be a big boon for the economy,” he said at the Delivering Alpha conference presented by CNBC and Institutional Investor.
Republicans aim to overhaul the American tax code but have faced various hurdles in their goal of passing a tax reform bill this year. Congress and the White House have not yet released a plan but are working this month to prepare legislation. Mnuchin heads to Capitol Hill on Tuesday to discuss tax policy with GOP congressional leaders, the latest in a series of meetings.
Earlier Tuesday, Mnuchin insisted that a tax overhaul would happen this year.
“We’re going to get this done by the end of the year,” Mnuchin told CNBC, adding that the administration is “super focused” on the goal following the three-month debt limit and government funding extension passed last week.
The Senate Finance Committee will hold a hearing on Thursday on individual tax reform. Sen. Orrin Hatch, the committee’s chairman and one of the six primary tax negotiators, said he expects to share the plan with other lawmakers after that and other hearings.
President Donald Trump urged lawmakers last week to push forward with tax legislation “ASAP,” telling them not to wait until the end of September. Tax reform is one of the key planks of the agenda he pitched as a candidate, and he has made two recent speeches touting the benefits of changes to the tax system without offering new details.
Trump has promised a plan to chop personal income taxes, slash corporate and pass-through company rates and have a one-time repatriation tax to encourage companies to bring back cash parked overseas. Republicans still face questions about how they will make up for the revenue lost in major tax cuts, especially because they have abandoned border adjustment, a cash-raising provision championed by House Speaker Paul Ryan.
Mnuchin said Trump‘s goal of chopping the corporate tax rate to 15 percent could be difficult to achieve.
“I don’t know if we’ll be able to achieve that given the budget issues. But we’re going to get this down to a very competitive level,” Mnuchin said.
The Treasury secretary also addressed deductions, most of which the administration said it wants to eliminate under its tax plan. That includes getting rid of state and local tax deductions.
Trump and White House officials have previously said they hope they can win over some Democratic senators on tax reform and reach 60 votes. The alternative is using budget reconciliation, which would require only a majority vote, meaning it could pass with only the 52 Republican senators.
Mnuchin said Republicans are prepared to use reconciliation if they cannot reach 60 votes. Some top GOP senators, including Hatch, have previously said they expect to have to use reconciliation.
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