President of the United States Donald Trump, in one of his recent statements given on tax cuts said, he was looking for multiple options for new cuts to stimulate the nation’s economy. However, his act proposed concerns for economic slowdown, which could also negatively affect his bid to regain the White House in 2020.
Speaking from the White House, the President proposed that the strategy of tax cuts wasn’t new, and that the plan would foster reduction in capital gain taxes as well as payroll taxes. “We’re looking at various tax reductions,” he said.
In April, the Treasury Department released a new round of tax-favored investments in low-income areas. The department said that it was aiming to provide a smooth path ahead to investors looking forward to tax break, however, it didn’t specify how exactly was it possible.
The scenario still prevails, and Trump’s statement was yet another reflection of uncertainty in the same direction. As per the laws, one of the major obstacles is that 50% of a company’s gross income has to come from inside the opportunity zones– a reform introduced under Trump’s 2017 Tax Cuts and Jobs Act– and how that is defined.
“We’re in such a strong economic position. We’re right now, the number one country anywhere in the world by far, and Europe’s got a lot of problems. Asia’s got a lot of problems,” Trump said defending his decision.
Presently, the consideration for a new fiscal boost has also a lot of other issues. Primarily, any new tax cut package would need approval from Congress, which is highly unlikely to happen since the House is in control of the Democrats. Secondly, Congressional Democrats have stated that big firms were the pivotal beneficiaries of Trump’s income and corporate tax cuts in 2017. Therefore, passing of a new package would have similar effects or drawbacks on the economy.
Jim Manley, a former senior aide to Democratic senators Harry Reid and Ted Kennedy, said the President’s “manoeuvre reeks of panic” because “every day he and his team are telling the American people that everything is OK.”
The political debate over new fiscal stimulus has increased since the White House officials have sensed that an economic recession is on the cards – a result of the ongoing trade wars. However, Trump hasn’t moved and even the White House tweeted Sunday: “Opportunity Zone incentives—part of President @realDonaldTrump’s historic tax cut legislation—are expected to spur $100 billion in long-term private capital investment in 8,764 underserved American communities,” issuing another sign that Republicans are far-off from accepting their defeat.
The Democratic-led US House of Representatives Judiciary Committee came back after a six-week long recess on