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Trump says rich might pay more in taxes, talks with Democrats

Trump says rich might pay more in taxes, talks with Democrats
From Reuters - September 13, 2017

WASHINGTON (Reuters) - President Donald Trump said on Wednesday that taxes on rich Americans might rise, as he pursues a tax code overhaul and reaches out to both Democrats and Republicans in a push to win support for a plan still far from complete.

As Trump prepared to host the two top congressional Democrats at a White House dinner, Treasury Secretary Steven Mnuchin told Fox News that the administrations tax cuts could be paid for through economic growth.

The White House and the Republican-led Congress have not put forth a detailed tax plan, despite months of high-level talks that had until recent days excluded Democrats.

House of Representatives Speaker Paul Ryan said an outline of a plan would be unveiled during the work week beginning Sept. 25, with congressional tax-writing committees crafting detailed legislation in the subsequent weeks.

Mnuchin told Fox the administration would use its own economic assumptions to gauge the impact of its tax cuts on the federal budget deficit and the $20 trillion national debt, a key issue in Washingtons intensifying tax debate.

It will be revenue neutral under our growth assumptions, Mnuchin said. The administration believes that tax cuts will lead to much faster growth than do congressional analysts or private forecasters.

So, we can pay for these tax cuts with economic growth, he added.

As for taxing the rich, Trump said after a meeting with lawmakers that the wealthy will not be gaining at all with this plan. ... If they have to go higher, theyll go higher, frankly.

Further details were not immediately available from the White House.

TAXING THE RICH

Democrats have criticized Republican tax overhaul efforts as benefiting mainly the wealthiest Americans and corporations.

Tax experts said Trump could raise taxes on high-income people by lowering the cap on mortgages eligible for interest deductions to $500,000 from $1 million. Another step might be to close a loophole that lets Wall Street fund managers pay low taxes on much of their income, analysts said.

Trump might also propose eliminating the deduction for state and local taxes, then use the revenue raised to fund tax cuts for the middle class, leaving top earners with a higher effective tax bill. There has also been talk in the Senate about increasing tax rates on capital gains and dividends.

But even with those changes, analysts said it was not clear top earners would end up paying more overall, partly because Trump has also proposed cutting the top individual tax rate.

Steven Rosenthal, a senior fellow at the nonpartisan Tax Policy Center think tank in Washington, said Trump was unlikely to raise taxes on investment income.

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