by Mike Godfrey, Tax-News.com, Washington
22 August 2019
United States President Donald Trump said on August 20, 2019, that the administration is considering additional tax cuts to help maintain economic growth.
Responding to press questions ahead of his bilateral meeting with Romanian President Klaus Iohannis at the White House, President Trump said that the Government was exploring the idea of “various tax reductions.”
In particular, Trump mentioned the possibility of indexing capitals gains to inflation for tax purposes, and of reducing payroll tax.
“I would love to do something on capital gains,” the Present said. “We’re talking about that. That’s a big deal; it goes through Congress.”
“Payroll tax is something that we think about and a lot of people would like to see that,” he added.
The indexation of capital gains is a proposal that would already appear to have much support among Republican members of Congress after 21 Republican Senators recently signed a letter to Treasury Secretary Steven Mnuchin urging him to amend how capital gains tax liability is calculated.
In the letter, dated July 29, 2019, they highlight that taxpayers can be liable to tax even where they have made a loss, because the price at which a security is bought for is not adjusted for inflation when capital gains tax liability is calculated.
However, in turn, 42 Democratic members have put their names to a letter to Mnuchin urging him to reject these proposals, arguing that such a measure would overwhelmingly benefit wealthy taxpayers and open up new “tax sheltering opportunities.”