Trump promises tax reform plan this week

Officials play down chances of major tax overhaul as 100-day mark looms

US president Donald Trump: approval rating is at a record low for any president at this point in his presidency, according to a new poll. Photograph: Kevin Lamarque/Reuters

US president Donald Trump: approval rating is at a record low for any president at this point in his presidency, according to a new poll. Photograph: Kevin Lamarque/Reuters

 

US president Donald Trump will unveil a major tax reform package on Wednesday, the latest attempt by the president to rush through policy initiatives before he reaches the 100-day mark in office next weekend.

“Big TAX REFORM AND TAX REDUCTION will be announced next Wednesday,” Mr Trump tweeted over the weekend, following similar comments made on Friday.

However, his officials appeared to downplay the possibility of a major tax overhaul, which many had expected to take place later in the year given the complexities of the issues.

Any tax reform needs to be passed by Congress but, despite Republicans controlling both Houses, the party is divided on some key issues, particularly the idea of a border adjustment tax which would levy imports and be a big revenue-generator.

Minister for Finance Michael Noonan said on the fringes of the IMF-World Bank meetings in Washington that the border tax appeared to have receded from the conversation about US tax reform.

However, he expected a corporate tax cut and some move to encourage the repatriation of profits by US multinationals, a development that would affect US multinationals in Ireland.

Executive order

Mr Trump’s comments came as he signed an executive order on Friday ordering a review of Obama-era tax rules in order to simplify the tax code, in part, a way of encouraging US companies to stay in the US.

With Mr Trump set to reach the landmark 100- day mark next Saturday, a new Washington Post-ABC poll on Sunday revealed that the president’s approval rating is at a record low for any president at this point in his presidency. But most people approve of his efforts to encourage US companies to stay in the US, while those who say the economy is improving are outnumbering, by the biggest margin in 15 years, those who say it’s getting worse.

As the US congress returns to session on Monday after a two-week break, all eyes will be on Capitol Hill this week as Washington works to avoid a possible government shutdown.

Legislators have until April 28th to pass a raft of spending measures to ensure that funds for federal programmes do not dry up. This may include demands by Mr Trump for federal funding to construct his promised wall on the Mexican border.

While many are fearing a rerun of the 2013 shutdown, House speaker Paul Ryan said at the weekend that a Bill would be passed in time to avoid a shut-down on Friday.

Criticism dropped

Meanwhile, as the annual IMF-World Bank spring meetings concluded in Washington, delegates dropped a sharp criticism of protectionism from the final communique, a move that was seen as a reflection of the impact the new US administration is having on global policy.

It follows similar language in a G20 communique last October, when the 189-nation group had called or all countries to “resist all forms of protectionism”.

In a joint session with IMF managing director Christine Lagarde on Saturday, US treasury secretary Steve Mnuchin said the US economy under President Trump was “well-positioned for growth” of about 3 per cent of more. He described the IMF’s outlook for the US as “a little conservative”.