Treasury's Mnuchin concerned about alternate scoring models of Trump tax plan
U.S. Treasury Secretary Steven Mnuchin told lawmakers on Thursday that he has some doubts that what are known as alternate scoring models will give enough credit to the potential for economic growth when assessing the impact of the Trump administration's tax plan.
In late April, the administration put out a one-page overview of its tax reform plans, which would cut taxes for businesses to 15 percent, as well as cutting taxes and simplifying income tax brackets for individuals.
Critics questioned how the tax cuts would be offset without driving up the federal deficit.
"What I have said repeatedly is that any plan we put forward we believe should be paid for with economic growth," Mnuchin told the Senate Banking Committee.
"I am concerned as to whether some of the models will attribute enough growth in dynamic scoring but when we present the details we will present how we think it should be paid for."
Mnuchin has said the April plan was deliberately vague in order to allow the White House to more effectively work with lawmakers to come up with a joint agreement that could pass Congress.
How to pay for the tax cuts remains a sticking point.
Fiscal conservatives in the Republican-controlled Congress would strongly prefer a revenue-neutral plan as they are against increasing deficits.
Mnuchin has said the cuts would pay for themselves under a dynamic scoring model analysis, which takes into account the effect of tax changes on economic growth and revenue.
At Thursday's hearing, Mnuchin was also peppered by Democrats on the committee about details of the tax plan, including whether or not cuts would mostly benefit the wealthy.
"I can assure you the president's objective and my objective is we create a middle income tax cut and we do not raise taxes on the middle income, if anything the opposite," Mnuchin said.
He added that the plan would get rid of almost every single tax deduction, which he said were disproportionately used by the wealthy and that the aim was that 95 percent of Americans would no longer need to itemize deductions.
Later on Thursday at a U.S. Chamber of Commerce event, the Treasury secretary insisted that tax reforms remain on track despite growing doubts among investors on the size and scope of any cuts achievable in Congress.
A renewed push on a repeal of Obamacare is currently being worked on in the Senate while reports that President Donald Trump may have tried to interfere with a federal investigation has shifted focus away from the congressional agenda.
"I am still very hopeful that we'll get tax reform done this year," Mnuchin said.