President’s comments on taxes in speech to Congress

President Trump addresses joint session of Congress

President Trump tonight addressed a joint session of Congress. In terms of tax issues, President Trump indicated that his economic team “is developing historic tax reform that will reduce the tax rate on our companies so they can compete and thrive anywhere and with anyone.” He stated that “it will be a big, big cut.” He also indicated that his administration will provide “massive” tax relief for the middle class.

1000

In addition, the president emphasized the importance of creating “a level playing field for American companies and workers,” stating that: 

 

Currently, when we ship products out of America, many other countries make us pay very high tariffs and taxes―but when foreign companies ship their products into America, we charge them nothing or almost nothing.

 

He then provided an example of  the difficulties U.S. businesses have doing business with other countries “because they tax our goods at such a high rate.”

The president said that he believes strongly in free trade, “but it also has to be fair trade” and concluded that he would not let  “America and its great companies and workers be taken advantage of anymore.”

After the speech, Treasury Secretary Mnuchin issued a brief statement expressing the need to simplify the tax Code, reduce business tax rates, and make America competitive in the global economy.

KPMG observation

President Trump did not provide details regarding specific tax reform proposals, nor did he indicate when his administration might release its tax reform proposal. He also did not explicitly address the border adjustment proposal contained in the House Republican “blueprint” for tax reform. It is not clear to what extent his comments about creating a level playing field relate to taxes, trade, or both.

© 2024 KPMG LLP, a Delaware limited liability partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.


For more detail about the structure of the KPMG global organization please visit https://kpmg.com/governance.

The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 3712, 1801 K Street NW, Washington, DC 20006.

Connect with us