Wed, Sep 27, 2017
President Donald Trump and congressional Republicans are proposing a tax plan that they say will be “significant and meaningful.” The 9-page document, “United Framework for Fixing Our Broken Tax Code,” includes specifics about cutting the top tax rate for the wealthy, drastically slashing taxes for business and eliminating most itemized deductions.
Page 8 of the document includes a section that the Association will be monitoring closely: TAX RULES AFFECTING SPECIFIC INDUSTRIES – which states: Special tax regimes exist to govern the tax treatment of certain industries and sectors. The framework will modernize these rules to ensure that the tax code better reflects economic reality and that such rules provide little opportunity for tax avoidance.
The plan calls for:
- Cutting the corporate tax rate from 35 percent to 20 percent. The GOP proposal also calls for reducing the number of tax brackets from seven to three with a surcharge on the wealthiest Americans.
- Lowering the top rate on income for so-called “pass-through” businesses to 25 percent. Pass-through businesses include everything from small businesses to law firms and have their income taxed through the individual code.
- Allow businesses to immediately write off the full costs of their capital investments for at least five years.
- Partially limiting businesses’ ability to deduct their interest expenses. This deduction is important for many industries, including agriculture, private equity and real estate.
- Allows the tax-writing committees to decide what business tax breaks to eliminate but calls for the preservation of the research and development tax credit and the low-income housing tax credit.