LDN - Other News

Trump in tax meeting amid fight with Republican senator

[October 25, 2017] By Susan Cornwell and Amanda Becker

WASHINGTON (Reuters) - President Donald Trump sought support on Tuesday in the U.S. Senate for his plans to cut taxes, stressing the need to help business and the middle class, in a meeting overshadowed by two senior Republican senators' unusually blunt attacks on him.

As Republicans were trying to unify around a package of deep tax cuts, Trump tangled with Senator Bob Corker in an exchange of insulting tweets and later came in for scathing criticism from Senator Jeff Flake.

In a morning tweet, Tennessee's Corker called Trump a liar who has damaged U.S. standing in the world and warned him against interfering in congressional efforts to cut taxes.

Trump lashed back with a tweet about Corker, saying the outspoken Senate fiscal hawk "couldn't get elected dog catcher."

Later in a dramatic speech on the Senate floor, Arizona's Flake announced he would not seek reelection next year and said that U.S. politics had become inured to "reckless, outrageous and undignified” behavior from the White House.

Securing passage by Congress of his tax-cut plan is critically important to Trump, who has yet to score a major legislative win since taking office in January amid a steady stream of distractions and Republican infighting.

After failing to repeal Obamacare despite months of effort, Trump last month unveiled a nine-page "framework" for cutting taxes on high-income earners, slashing business taxes and offering tax help to other Americans.

It was not yet clear if the broadsides from Corker and Flake would imperil the tax-cut agenda, but they were certain not help since Republicans have only a slim 52-48 majority in the Senate, where Democrats oppose the Trump tax package.

In a closed-door lunch meeting with Republican senators, Trump said he wanted to make sure middle-class tax cuts were part of the plan and that wealthy people do not need help on taxes, Republican Senator John Cornyn told reporters afterward.

“We talked about the importance of helping ordinary people ... We talked about the importance of helping businesses," said Republican Senator John Kennedy after the lunch, adding Trump got three standing ovations in the lunch.

TAX 'UNTRUTHS'

Democrats have painted Trump's plan as a gift to the rich and corporate America that would balloon the federal deficit and add to the $20-trillion U.S. national debt.

Democratic Senator Ben Cardin said middle-class families would pay more, not less, under the Republican tax proposal.

Senate Democratic leader Chuck Schumer told reporters, "What the president says about tax reform has been correctly characterized by Senator Corker as 'untruths'"

[to top of second column]

President Donald Trump walks with Senate Majority Leader Mitch McConnell (R-KY) as he arrives for the Republican policy luncheon on Capitol Hill in Washington, U.S., October 24, 2017. REUTERS/Joshua Roberts

One of the key elements of the proposal is to slash the corporate income tax rate to 20 percent from 35 percent. While the broad parameters of the tax proposal have been made public, detailed legislation has not yet been unveiled.

House of Representatives Speaker Paul Ryan said he wants the House to pass the Republican tax cut bill by the Nov. 23 U.S. Thanksgiving holiday, echoing Trump's call to speed up the party's efforts to get the measure approved before year's end.

CNBC reported that Republicans plan to release their tax bill on Nov. 1 after an expected House vote on Thursday on a Senate-approved budget plan.

House leaders are eager to get a tax bill voted on before a Dec. 8 deadline for a possible government shutdown, as that is likely to distract from the tax overhaul, financial firm Cowen and Co said in a research note.

"The Senate time-frame on taxes remains much more of a mystery with a Senate Finance draft likely in the late November/early December time frame," Cowen analyst Chris Krueger said.

FISCAL CONCERNS

The White House says tax cuts are needed to boost economic growth and create jobs, but some Republicans worry that they would endanger America's long-term fiscal health.

Trump said he believed the tax overhaul would help bring in $4 trillion in foreign profits from U.S. companies. "It's going to bring back, I would say, $4 trillion back into this country," Trump told reporters in the Oval Office. "Nobody even knows the amount," Trump said.

Market analysts' estimate of foreign profits being held offshore tax-free by U.S. multinationals are widely available and put the figure at about $2.6 trillion. Trump's tax plan would require multinationals to bring those profits into the United States, but give multinationals a sharp tax cut on them.

(Reporting by Susan Cornwell and Amanda Becker; additional reporting by Makini Brice, Doina Chiacu and Richard Cowan; Writing by Alistair Bell; Editing by Will Dunham and Grant McCool)

Back to top