Trump's tax reform

President Trump wants to revive the US economy with the "largest tax reform in the history of our country". Secretary of the Treasury Steven Mnuchin and chief economic advisor Gary Cohn on Wednesday presented the plan, which foresees tax relief for businesses and the wealthy. While some commentators recommend that Europe also adopt similar plans, others find them unrealistic.

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The Daily Telegraph (GB) /

A model for Britain to copy

Trump's plan to cut taxes is the right approach and should be followed by British politicians, The Daily Telegraph writes approvingly:

“Whether he will be any more successful in doing so than he has so far been in imposing immigration controls on Muslims, building a border wall with Mexico or overhauling his predecessor's healthcare policy remains to be seen. But this is as much about direction of travel as anything else. Even if Mr Trump gets half of what he is trying to do through Congress he will have engineered a massive tax boost for US businesses and earners. ... There are lessons here for Britain as we prepare to go to the polls. While the Americans are moving in the direction of lower taxes there is a risk here that we may go the other way.”

Le Temps (CH) /

The Republican's won't play along

Trump's tax initiative threatens to backfire as spectacularly as his attempt to abolish Obamacare, Le Temps believes:

“The proposed taxation system would deprive the treasury of 2.2 trillion dollars in revenues over ten years, according to the think tank The Tax Foundation. To compensate for this immense cost Donald Trump is counting on growth of over 3 percent per year on the short term. But his vision of a virtuous circle - in paying fewer taxes businesses will make more profit and hence generate more tax revenue - does not convince certain people in his party. The Republicans who are the most attached to budget orthodoxy fear an explosion in the budget deficit. ... So President Trump risks once more being foiled by the mechanism at the heart of his failure on Obamacare: opposition from members of his own camp.”

Corriere della Sera (IT) /

Trump fuelling global tax competition

With his reform Trump hopes to score points at home but Europe will suffer the consequences, Corriere della Sera concludes:

“It is an attempt to add a little substance to the anaemic balance sheet after 100 days of Trump's presidency. But this plan is not improvised: it is the work of his Goldman Sachs men (namely his economic adviser Gary Cohn and his Secretary of the Treasury Steven Mnuchin). Should Congress approve the reform, it will have serious consequences at the international level. ... Because with corporate tax at 15 percent in the US, the other countries, in particular the EU, will have to say farewell to the idea of taxing the international profits of US multinationals (like Apple). Because they will be funnelled back to the US. This money, Trump hopes, will be invested in the United States once more and create jobs there. The latter may be an illusion but there can be no doubt that the rest of the world will have its work cut out for it in the corporate tax competition.”