Route 66
One of the senior White House officials said there would be ample time to discuss specifics later, but that it was equally important to rally Americans behind the notion that changes would benefit the middle class. The destination of Springfield, the start of Route 66, was a deliberate choice intended to underscore how a tax overhaul could benefit the Main Street America that thrived during the iconic highway’s heyday, a second White House official said.
The Trump administration may have also targeted Missouri in an effort to help to flip a Senate seat. In a message on Twitter Sunday, the president touted his 19-point victory in Missouri last fall -- and that Senator Claire McCaskill, the Democrat facing a tough re-election fight next year -- “is opposed to big tax cuts.” Trump went on to predict that McCaskill would be ousted by her eventual Republican opponent.
McCaskill’s office issued a statement saying she was “optimistic” that she could find “common ground” with Trump on taxes.
The president plans to go to other swing 2018 states to sell a tax revamp to put pressure on Democrats to support the legislation, according to a person familiar with the White House’s thinking who requested anonymity to discuss internal plans.
Top Earners
Republican leaders may indeed find broad agreement that the statutory rate for corporations -- which at 35 percent is far higher than most other developed nations’ -- must be cut. They may also find support for revising corporate taxes to keep U.S. companies competitive while limiting their ability to shift profit overseas and enabling them to return more than $2.6 trillion in offshore profit to the U.S. at a lower rate.
But they’re unlikely to find agreement with Democrats when it comes to changes for individual taxpayers. Forty-five Senate Democrats signed a letter earlier this month outlining their preconditions for supporting a potential tax overhaul bill -- one of those requirements was that a tax bill couldn’t include tax cuts for the top 1 percent.
Tax policy experts have said the dozen bullet points the White House released in April outlining its principles would undoubtedly mean lower taxes for top earners, while the impact on middle incomes was less clear. The plan calls for cutting the top income-tax rate to 35 percent from 39.6 percent; eliminating the Alternative Minimum Tax, which raises the tax bills of certain taxpayers on the higher side of the income scale; and repealing the estate tax, which applies to individuals with estates worth more than $5.49 million. However, it would also eliminate state and local tax deductions, which tend to benefit high-income filers in Democratic states.
For middle-class benefits, the White House tax plan has recommended doubling the standard deduction and providing tax relief for families with child- and dependent-care expenses.