President Trump is planning to cut the corporate tax rate to 15 percent even though that means a loss of revenue. Trump told his staff during a meeting in the Oval Office that he wants a massive tax cut for the American public.
The 15 percent rate would apply both to corporations, which now pay 35 percent, and to a broad range of firms known as pass-through entities including hedge funds and real estate firms. The White House is now planning to formally roll out its tax plan following a period of discussion on rewriting the tax code and various proposals on how the tax cut would be structured.
Trump also plans to propose a 10 percent tax on more than $2.6 trillion in earnings that U.S. companies have stockpiled offshore. This would allow companies to bring back money from overseas to the US with a slightly lower, one-time tax.
One proposal in the plan is the repeal of the so-called alternative minimum tax. The original purpose of the AMT was to prevent very wealthy Americans from using deductions and loopholes to skimp on their taxes. The AMT has a set of rates and rules that are distinct from the regular tax code and apply to certain high-income earners, trusts, estates, and corporations.
