President Donald Trump’s long-promised reforms to the U.S. tax code will reportedly include tax cuts for the wealthiest Americans, a feature that will surely spark backlash from Democrats.
The administration and Republican Party leadership is planning to cut the tax rate for pass through businesses from 39.5 percent to 35 percent, Axios reports. The majority of U.S. businesses are not subject to the corporate tax rate and instead pay taxes on profits that are passed through to the proprietors of the business and taxed at an individual rate.
Forty-five Senate Democrats sent a letter to Trump and Republican leadership in August in which they wrote “tax reform cannot be a cover story for delivering tax cuts to the wealthiest … We will not support any tax plan that includes tax cuts for the top 1 percent.â€
Trump is expected to give a speech in Indiana on Wednesday where he will layout the administration’s plans for tax reform, which he has worked on with party leadership, Secretary of the Treasury Steve Mnuchin and National Economic Council Director Gary Cohn.
Other features of the plan will include dropping the corporate tax rate from 35 to 20 percent, which is 5 percent higher than Trump wanted on the campaign trail.
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