Trump touts tax plan in Harrisburg-area speech
President Donald Trump pressed his case for tax cuts on Wednesday during an address in Dauphin County aimed at middle- and working-class Americans.
If successful, the president's agenda for overhauling federal tax code could give the typical American household "a $4,000 pay raise" and "dramatically cut the business tax rate so that American companies and workers can win" against foreign competitors, he said.
But as Trump alluded to during his remarks at the Pennsylvania Air National Guard base in Middletown, it's not the general public whose cooperation he needs most if his vision is to become law.
"All I can say is: you better get it passed," Trump said to congressional Republicans, including Pennsylvania representatives who were among the invitation-only audience of business, political and community leaders gathered inside a military aviation hangar decked out in American flags. Many of the guests included officials from trucking companies and industry trade groups.
While the crowd of about 1,000 applauded loudly, it remains to be seen whether Trump can rally the same level of support in Congress, where even members of his own party seem divided on the recently unveiled plan.
With a patriotic-themed 18-wheeler on the tarmac behind him, Trump insisted that his tax proposal is "pro-growth, pro-jobs, pro-worker, pro-family and pro-America," adding that "it's our wonderful workers who (will) reap the rewards, including our great truckers who will have more products to deliver and more contracts to fill."
"The biggest winners from this transformation will be everyday families, from all backgrounds, from all walks of life, and our great companies, which will produce the jobs," the president said. "They are going to produce jobs like you've never seen before."
Among key elements of the nine-page tax-reform plan outlined by Trump:
• Cutting the corporate tax rate "from 35 percent and more, all the way down to no more than 20 percent."
• Sole-proprietors, S corporations or partnerships would see their top tax rates capped at a maximum of 25 percent.
• Cutting the marginal tax rate for small businesses by 40 percent.
• Encouraging companies to repatriate trillions of dollars held overseas.
"Our current tax code actually punishes companies for keeping their headquarters in America," Trump said.
"We will totally eliminate the penalty on returning future earnings back to the United States. And we will impose a one-time low tax on money currently parked overseas so it can be brought back home to America where it belongs, and where it can do its job," he added.
• Eight income tax brackets would be reduced to four, and most families would be able to file their taxes on one sheet of paper. What the proposal does not say is where income levels would fall under the new brackets. Such detail is likely to be left to Congress to negotiate.
• The standard deduction of $6,350 for individuals and $12,700 for couples would nearly double.
"Under our framework, the first $12,000 for a single individual and the first $24,000 for a married couple, will be tax free. No tax at all," Trump said. As a result, the time-honored ritual of documenting temized deductions would be eliminated.
• Ending the "crushing, horrible, and unfair estate tax, sometimes known as the death tax," the president said.
That tax tends to affect mostly wealthy families, however, as it applies only to assets worth more than $5.49 million.
• Expansion of the child tax credit, currently $1,000 per child, although the amount has not been specified.
• Elimination of "tax breaks and special interest loopholes that primarily benefit the wealthy," he said.
Trump said the plan, if passed, would be the nation's largest tax reform program since 1986, a Reagan-era achievement that resulted from bipartisan cooperation, he added.
"That would be wonderful. But sadly, the Democrats have become obstructionists," the president added. "They want to raise your taxes very, very substantially."
One of the state's top Democrats, not surprisingly, disagreed.
U.S. Sen. Bob Casey on Wednesday was busy tweeting out a stream of rebuttals to Trump's tax plan, calling it "a bad deal for middle class families and workers." Among Casey's contentions:
• Repealing the estate tax would give $27 billion a year to America’s 5,500 richest families.
• Nearly 90 percent of business tax cuts would go to the top 1 percent, "because most small businesses don’t pay anything close to the top tax rate," he said.
• A family of four would gain $11,300 in standard deduction but lose $16,200 in personal exemptions.
• The plan would increase the tax rate from 10 percent to 12 percent on family income below $18,650.
• "Tax on a single piece of paper? We already have it," Casey tweeted.
"It’s called the 1040EZ," he added, referencing an existing IRS tax form.
Other criticism of the plan has come from outside party politics.
Late last month, an analysis released by the nonpartisan Tax Policy Center found that wealthy individuals and business would benefit the most, the New York Times reported, while many middle class taxpayers would be negatively impacted.
The cuts will cost $2.4 trillion over a decade, the analysis found, questioning whether resulting economic growth would be adequate to offset that amount.
Attendees at Wednesday's event were more optimistic.
David Black, president and CEO of the Harrisburg Regional Chamber and Capital Region Economic Development Corp., said he thought the president's presentation was "compelling," and that the various corporate and personal deductions could help spur economic growth.
"I think this is a good thing," Black said. "It's what he ran on, what he won on — helping the middle class."
What happens next with the plan "is largely up to Congress," Black acknowledged, but he feels the president "has got a nice framework, and he does have some good people working with him," including Pennsylvania's other U.S. Senator, Republican Pat Toomey.
Either way, Black left the speech pleased that Trump's appearance brought more national media attention to the midstate.
"We have a lot going on here — you've just had the Rise of the Rest tour here in our area, and next week we plan to submit our Amazon bid," Black said.
"This is all very good for our region, for southcentral Pennsylvania," he said.