In what may be the final nail in President Trump’s tax reform proposal, months after the White House proposed ending a tax break for people in high-tax states – which would suggest Trump had more than enough time familiarize himself with how it all works – Trump reportedly “grew angry” when he learned that the change would hurt some middle-income taxpayers, Bloomberg reports citing people familiar with his thinking.
As Bloomberg amusingly adds, “It’s not clear why the president didn’t know the implications of the SALT deduction for middle-class taxpayers when the plan was released.”
Trump’s confusion appears to have led to even more confusion everywhere else: according to Bloomberg, Trump’s concerns led him to say this week that ‘we’ll be adjusting’ the tax-overhaul framework, but it’s not clear how he and congressional leaders would make up for the $1+ trillion in revenue that would be lost without ballooning the deficit or torpedoing support for the plan among hard-line conservative Republicans. Meanwhile, Trump’s top economic adviser Gary Cohn said Thursday morning that the president “is not rethinking his position on repealing the state and local tax deduction” contradicting what Trump himself said previously.
In any case, while the plan to eliminate State and Local tax deductions may have been prompted by an initial assumption that such a move would mostly hit blue states as shown below…
This post was published at Zero Hedge on Oct 12, 2017.