Rachel Bovard, director of policy services at the Heritage Foundation, joined Thursday’s “The Morning Blaze with Doc Thompson” to talk about President Donald Trump’s tax plan, government debt and special interest lobbyists.
Trump’s new tax plan aims to make big cuts for businesses by taking the corporate tax rate from 35 percent to 15 percent. One of the plan’s provisions would incentivize companies to bring capital held overseas back to the U.S. during a “repatriation holiday” where money that returns to the country will be taxed at a lower rate.
While repatriation would bring money back into the country, it wouldn't correct the circumstances which caused companies to hold capital overseas in the first place.
“It’s not really fixing the problem of double taxation, of the incentive that actually pushes companies to hold their money overseas, but it does have the effect of bringing in at a one-time instance, bringing a ton of money into the economy.”
The tax plan would also end tax deductions other than mortgage interest and charitable donations. Bovard explained that tax loopholes used by special interest groups are being targeted.
“I think you’re going to see the war of the special interests break out on the streets of Washington as [Trump] starts to go after these,” Bovard said. “Each one of these special interest tax deductions has a lobbying force behind it.”