Thursday 23 November 2017

Donald Trump's tax plan 'will be rejected and changed by Congress'

Former US Senator George Mitchell Picture: Gerry Mooney
Former US Senator George Mitchell Picture: Gerry Mooney
Colm Kelpie

Colm Kelpie

Former US senator George Mitchell has said it is unlikely that US President Donald Trump's tax plan, which proposes slashing America's corporate tax rate to 15pc, will make it through Congress without being altered.

While he backed moves to reform the US corporate tax system, he said that should not be seen as a challenge to Ireland.

Mr Mitchell also said he believed Brexit would prove historically to be a "huge error on the part of the United Kingdom".

The veteran US political figure was in Ballina, Co Mayo, to give the International Human Rights Lecture organised by the Mary Robinson Centre.

Ahead of his address, Mr Mitchell told reporters that Mr Trump's one-page tax plan, as announced, was more of an outline than a plan.

"Congress will have the last say on what any tax plan is and my own view, preliminarily, is that it's unlikely that the president's proposal, as announced, will be enacted as announced," the former Democratic Party senator said.

Read More: World stocks dip in wake of proposals

"There will be much debate, much discussion. I was in the Senate in 1986, the last time we made a major change in our tax structure, and that took two years and the form that it ultimately took was significantly different from the form presented by president Reagan two years earlier."

On Wednesday, the White House unveiled plans for what officials called the "biggest tax cut" in US history, proposing lower taxes for businesses, the middle class and the wealthy.

But the one-page policy left details of when the cuts will be implemented, over what time frame and how they will be paid for all unanswered.

Priorities

Mr Trump's top economic adviser Gary Cohn and Treasury Secretary Steven Mnuchin set out a list of tax priorities.

These included a one-off tax deal to bring home $2.6trn (€2.4trn) in profits parked offshore by corporations.

Mr Mitchell said he hoped and expected that there would be tax reform in the US, claiming the corporate tax system there was outdated.

"I don't think that should be seen as a challenge or a detriment to Ireland," Mr Mitchell said. "I think what is important for Ireland is that there continues to be a strong personal, political and trading relationship with the United States, which is mutually beneficial to both societies. I know that many American companies... value the quality of the people here."

He said that while the corporate tax system in Ireland had been a factor in attracting US companies, Ireland should not sell itself short in terms of the quality of the people.

Irish Independent

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