White House says it's hopeful for tax bill by year's end

White House says it's hopeful for tax bill by year's end

White House says it's hopeful for tax bill by year's end

It may not be possible to lower the corporate tax rate from 35 percent to 15 percent as President Trump has hoped, Treasury Secretary Steven Mnuchin said Tuesday.

Trump campaigned on the promise of cutting the corporate tax rate to 15%, but Mr Mnuchin said that the goal would be hard to achieve.

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Carried interest is the portion of an investment fund's returns that are paid to investment managers.

The Treasury secretary said the administration still wanted the carried interest break to be available to "other entities that create jobs". It is taxed at the long-term capital-gains rate of 23.8% compared with a rate of 39.6% assigned to ordinary income.

"I'm hopeful that they'll get a slight decrease in federal government [taxes] which will offset what they will lose on the state deductions", Mnuchin said of taxpayers who benefit from state deductions. The Trump administration has made completing a package of tax cuts a top priority, but the task is expected to be complicated by Democratic resistance and a divided Republican party. The White House is wary of relying exclusively on Republican support for the legislation after seeing the health care bill collapse and is genuinely seeking Democratic support, Short said. However, Republican leaders have yet to unveil details of what Trump has called a "massive" tax regime change, including such basic matters as where to set the corporate tax rate and how to set up individual tax brackets. Mnuchin said the administration was considering backdating tax reform to the start of 2017 and that this could deliver "a big boon" to the economy.

Mnuchin added that services firms, especially accounting companies, will no longer have the benefits of a pass-through rate, and will also have to pay a higher income tax rate. "The president wants to increase military spending and that's something he is going to demand for December".

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