Mnuchin: Trump ‘ready to go’ on tax reform

Treasury Secretary Steven Mnuchin said Friday that the White House is likely to release a tax-reform plan “pretty soon.”

At an event hosted by Axios, Mnuchin said that the Trump administration has been working on tax reform for the last two months.

“This is something, because we are designing it from scratch and running through a lot of scenarios we’ve needed the last two months to work on. We would not have been ready to go a month ago on tax reform, and now we are,” he said. 

Mnuchin said President Trump’s objective is to do comprehensive tax reform, rather than making tax changes on a piecemeal basis.

{mosads}He continued to avoid taking a hard stance on the House Republicans’ border-adjustment tax proposal, which would tax imports and exempt exports. The proposal is a key part of House Republicans’ tax-reform plan because it would raise more than $1 trillion that could be used to offset tax cuts. But it would be unlikely to pass the Senate because a number of senators have raised concerns about it.

Mnuchin said that there are “certain aspects of that tax that are attractive and there are certain aspects of that tax that are concerning.”

He noted that there are aspects of the border-adjustment proposal that are similar to the value-added taxes that other countries have and that there’s a case to be made for the U.S. having a tax system that is more like those of other countries. But he said the administration is concerned that currency adjustments resulting from the tax could hurt exporters.

“It’s a very complicated issue. We’re looking at it carefully,” he said, adding that the White House isn’t looking at the proposal “as is.”

When asked if he still thinks tax reform can be enacted by the August recess, Mnuchin said, “I’d like to think so.”

“This is optimistic, this is a big challenge, but we’re going to try to get it done on that period of time, and if we don’t we’ll get it done right afterwords,” he said. Mnuchin added that he “absolutely” thinks tax reform will be done by the fall.

Mnuchin said the White House wants to significantly lower the corporate tax rate and cut taxes for the middle class. He said that it remains Trump’s goal to tax the carried interest that hedge-fund managers receive as ordinary income rather than capital gains but that the administration is looking at making sure that the tax code doesn’t disincentivize investments by other types of investors.

The interview with Mnuchin came on the same day that the House is scheduled to vote on a bill to repeal and replace ObamaCare. A vote had previously been expected on Thursday, but it was postponed because it’s unclear whether the bill, known as the American Health Care Act, has enough votes to pass.

Mnuchin also said he’s “optimistic” that the healthcare bill will pass. He also said that healthcare and tax reform “are two very different things” and thinks that tax reform is a simpler issue than healthcare.

“We’re able to take the tax code and redesign things, and I think there is very, very strong support,” he said. “I think in healthcare, it’s [a] much, much more complicated issue, where you start out with ObamaCare, which had all these issues, and you’re trying to kind of get rid of it and make changes simultaneously.”