Trump Walks Back Consideration of Capital Gains, Payroll Tax Cuts
President Trump walked back consideration of capital gains and payroll tax cuts on August 21, less than 24 hours after signaling his support.
Trump: Tax Cuts Not Needed
"I’m not looking at a tax cut now; we don’t need it. We have a strong economy," Trump told reporters at the White House on August 21.
However, Trump alluded otherwise the day before when he told reporters on August 20 in the Oval Office that he had been looking at payroll and capital gains tax cuts for "a long time." To that end, Trump stated that his administration was currently considering "various tax reductions."
Trump: Not Looking to Index Capital Gains to Inflation
Moreover, Trump told reporters on August 20 that he could "directly" index capital gains to inflation, referencing a recent uptick in debate between Republican and Democratic lawmakers on the legality of such an executive move. Notably, Trump followed up his initial assertion of authority to circumvent Congress on the tax policy issue by stating on August 21 that if he wanted to unilaterally index capital gains to inflation, he would need a letter from the Attorney General.
However, the longstanding Republican and Democratic debate as to whether the executive branch has authority to index capital gains to inflation, at least for the time being, appears to be moot.
"I’m not looking to do indexing," Trump said on August 21. "I’ve studied indexing for a long time. I want tax [cuts] for middle-class workers. I think indexing is probably better for the upper income groups; I’m not looking to do that."
Copyright © 2019, CCH INCORPORATED. All Rights Reserved. Contents of this publication may not be reproduced without the express written consent of CCH and CBIZ. This publication is distributed with the understanding that CBIZ is not rendering legal, accounting or other professional advice. The reader is advised to contact a tax professional prior to taking any action based upon this information. CBIZ assumes no liability whatsoever in connection with the use of this information and assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.
CBIZ MHM is the brand name for CBIZ MHM, LLC and other Financial Services subsidiaries of CBIZ, Inc. (NYSE: CBZ) that provide tax, financial advisory and consulting services to individuals, tax-exempt organizations and a wide range of publicly-traded and privately-held companies.