Trump Promises CEOs Another Tax Cut

Trump Promises CEOs He’ll Cut Corporate Taxes Again

Former President Donald Trump huddled with congressional Republicans Thursday in his first visit to Capitol Hill since the partisan violence of January 6, 2021. Then he reportedly promised a Business Roundtable gathering of CEOs that he would cut the corporate tax rate to 20% if he wins another term in the White House.

The 2017 Republican tax cuts enacted during Trump’s first term slashed the corporate rate from 35% to 21%. The corporate change was made permanent while cuts to individual taxes were set to expire after 2025 to reduce the official cost of the plan. Republicans want to renew those expiring cuts and see a second Trump term as an opportunity to lower taxes further.

At a private event Thursday hosted by the Business Roundtable, an association of CEOs, Trump pledged to make the 2017 law permanent and further trim the corporate rate to 20%, Bloomberg’s Nancy Cook reports. She adds that Trump called the 20% figure a nice, round number and notes that “even a small reduction represents a tax cut worth billions of dollars each year for profitable US companies.”

Trump reportedly also promised to slash regulations if he becomes president again.

The tax talk in front of CEOs followed Trump’s visits earlier in the day with Republican lawmakers. Those intraparty discussions were reportedly supposed to touch on Trump’s vision for a 2025 policy agenda, including taxes and entitlements, but were instead — perhaps inevitably — dominated by gripes and grievances as the former president basked in his GOP support and took aim at his critics. (Politico’s Rachael Bade reported Thursday that, in the days after guilty verdicts were handed down against him on 34 felony counts in New York, Trump called the speaker seeking to have Congress help him get revenge and overturn his conviction.)

“I didn’t hear any agenda talk,” Republican Rep. Mark Amodei of Nevada told reporters. “It was a pep talk.” Asked if Trump supports the House GOP leadership team, Speaker Mike Johnson told reporters: “He said very complimentary things about all of us. We had sustained applause. He said I’m doing a very good job. We’re grateful for that.”

Trump didn’t steer entirely clear of policy talk, though. He reportedly urged lawmakers to discuss abortion access as a state issue, floated tariff increases as a way to pay for his tax cuts, and again raised the idea of eliminating taxes on service workers’ tips, which he first mentioned at a recent Las Vegas rally.

“President Trump simply floated the idea [of higher tariffs] as one of many brought up during the conversation, and he has said many times that as tariffs on foreign countries go up, taxes on American workers can come down,” campaign spokeswoman Karoline Leavitt said in a statement to Bloomberg. “President Trump’s top priority remains making the Trump Tax Cuts permanent.”

That approach ignores the fact that tariffs imposed on foreign goods are paid by American consumers.

What it all means: Trump has promised another round of sweeping — and costly — tax cuts if he wins in November. At a rally last month in New Jersey he told the crowd: “Instead of a Biden tax hike, I’ll give you a Trump middle class, upper class, lower class, business class big tax cut.”

Biden, meanwhile, wants to raise taxes on the wealthy and large, profitable businesses while preserving the lowered tax rates for those earning less than $400,000 a year.

The differing approaches to the expiring tax law represent a key issue at stake in November. “Although congressional Republicans haven’t specified how they’ll finance this round of tax cuts, every major Republican tax cut for the wealthy or corporations in recent decades has put the burden on middle- and low-income Americans, and this time will be no different,” Lael Brainard, director of Biden’s National Economic Council, told reporters Wednesday.

HuffPost’s Jonathan Nicholson reports that Brainard said there are four ways the GOP could look to offset at least some of the cost of their tax plans: “She said they could use revenues from the 10% across-the-board tariff Trump has proposed on imported goods; they could cut entitlement programs like Social Security and Medicare; they could cut annual spending by federal agencies and programs excluding defense; or they could simply borrow, adding the costs of the tax cuts to the public debt.”

“One way or another, the American people will pay the price for the congressional Republican approach,” Brainard said.

G7 Nations Agree on $50 Billion Loan for Ukraine, Backed by Russian Assets

President Joe Biden and leaders from the Group of Seven nations meeting in southern Italy have agreed to provide a $50 billion loan to Ukraine to help the country defend itself against the ongoing Russian invasion that began in early 2022.

Roughly $300 billion in frozen Russian assets held largely in European banks will provide collateral for the loan, and interest produced by those assets will be used to cover loan repayments owed by Ukraine.

The U.S. will reportedly underwrite the loan, to be distributed before the year is over, but other members of the G7 — which includes Canada, France, Germany, Italy, Japan and the U.K., in addition to the U.S. — are expected to provide funds as well.

Ukraine President Volodymyr Zelensky, who was present at the beginning of the G7 meeting, thanked the group for the loan, which he said would be used for both defense and reconstruction purposes. He also called on the leaders to go further and seize the Russian assets in full — an option that has met resistance in the European Union due to concerns about legality and how international capital markets might react.

Speaking to reporters at the meeting, Biden said the loan agreement sends a message to Russian President Vladimir Putin. “He cannot wait us out, he cannot divide us,” Biden said. “We're going to stand with Ukraine.”

Biden said two additional steps taken at the meeting — a bilateral security agreement signed between the U.S. and Ukraine, and new sanctions on countries aiding Russia — reinforce the message.

Writing about the plan in The New York Times, Treasury Secretary Janet Yellen said the loan will provide Ukraine with “a decisive amount of funding” that sends a “clear message” to Putin from the U.S. and its allies: “We are in it for the long haul.”

European Council President Ursula von der Leyen, who also attended the G7 meeting, struck a similar tone. “It is a strong signal that we are sending to Ukraine that we will support Ukraine in its fight for freedom for as long as it takes,” she said. “It is also a strong signal to Putin that Putin cannot outlast us.”

Fiscal News Roundup

• G7 Leaders Agree to Lend Ukraine Billions Backed by Russia’s Frozen Assets. Here’s How It Will Work – Associated Press
• Biden Strikes Security Deal With Zelenskyy — but Its Future Is in Doubt – Politico
• Courting CEOs, Trump Says He Intends to Cut Corporate Taxes Again – New York Times
• Trump Floats ‘All-Tariff’ Federal Revenue System in Return to Capitol Hill – Wall Street Journal
• Trump Talks Tariffs and Taxes, Calls Republican Host City 'Horrible' – Reuters
• Trump Tells GOP He Plans to Entirely Reverse Biden’s EV Policy – Bloomberg
• Biden Economic Advisor Unveils ‘Key Principles’ for Tax Policy Plan Ahead of Expiring Trump Tax Cuts – CNBC
• Treasury Secretary Yellen Says US Debt Load Is in ‘Reasonable Place’ if It Remains at This Level – CNBC
• GOP Plots Big Push to Extend Tax Cuts if Republicans Sweep in November – CNN
• White House Warns on GOP Tax Plans If Trump Wins and Republicans Control Congress – HuffPost
• US Producer Prices Surprise With Biggest Decline Since October – Bloomberg
• Medicare Will Recalculate Quality Ratings of Medicare Advantage Plans – Wall Street Journal
• The Divisive Housing Perk Adding Thousands of Dollars to Lawmaker Pay – Wall Street Journal

Views and Analysis

• A New Way to Make Russia’s Assets Pay for Ukraine’s Defense and Rebuilding – Janet Yellen, New York Times
• Why Using Russian Assets to Fund Ukraine Is Fraught – Viktoria Dendrinou, Alberto Nardelli, and Jonathan Browning, Bloomberg
• $3.4 Trillion in Individual Tax Cuts Are Expiring Next Year. Biden and Trump Would Handle It Very Differently – Tami Luhby, CNN
• Fed’s Favored Inflation Gauge Set to Rise by Least in Six Months – Matthew Boesler, Bloomberg
• Some Kind of Carbon Tax Is Coming to America, Like It or Not – Mark Gongloff, Bloomberg
• How the Fed Can Cut Rates This Summer Without Cutting Rates – Aaron Back, Wall Street Journal
• Fantasyland General – Robert Kuttner, American Prospect
• People Hate Traffic. They Also Hate This Great Idea to Clear It – Megan McArdle, Washington Post