WASHINGTON – President Donald Trump’s administration unveiled his highly-anticipated tax plan Wednesday afternoon, promising one of the largest tax cuts in American history.
May details are yet to be seen, but here's a broad outline of what the president has proposed.
Corporate tax rates
The plan proposes a flat 15 percent business tax rate.
The rate would apply not only to large corporations but small business as well.
"Today, this administration will outline the president's vision for tax reform that will include one of the largest tax cuts for businesses and individuals in American history," Vice President Mike Pence said.
Individual tax rates
The plan is aimed at simplifying the tax code by reducing the number of personal income tax brackets from seven to three.
The three tax brackets would be:
- 10 percent
- 25 percent
- 35 percent
But administration officials said they are still working out specific income requirements for each bracket.
White House economic adviser Gary Cohen said the plan would cut the top income tax rate from 39.6 percent to 35 percent.
Other individual tax rate proposals include:
- Double the standard deduction for married couples to $24,000
- Eliminate all itemized deductions except mortgage interest and charitable donations
- Repeal the estate tax
- Repeal the catch-all alternative minimum tax
- Repeal the 3.8 percent tax on investment income
"In this case the Trump administration is absolutely delivering on a campaign promise and that was to slash taxes," Laura Albright said, a CBS4 political analyst and political science professor at the University of Indianapolis. "In terms of the corporate tax breaks, the idea would be that would help the economy because now corporations have more money to invigorate into it and they're not spending it in taxes. And that could help the consumer if they lowered costs or they helped employ more people."
But, Albright noted, passing a comprehensive tax reform package through Congress will be the real challenge.
"It's not strictly a partisan issue," she said. "There's so many differences from ideology and actual practice. It's no doubt more complicated and controversial."
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