“We want lower taxes, bigger paychecks, and more jobs for American truckers and for American workers,” Trump said.
He talked about the main features of his tax reform plan including simplification of the tax code, tax relief for middle-class families, lowering tax rates for individuals and corporations, repealing the death tax, and bringing back cash held by U.S. companies overseas.
According to Trump’s framework for reform, the top corporate tax rate will be cut from 35 percent to 20 percent. And for many American truckers who file taxes as sole-proprietors, S corporations or partnerships, the plan proposes to cap the top tax rate at 25 percent.
“This will be the lowest top marginal income tax rate for small and mid-sized businesses in more than 80 years,” Trump said.
He referred to entrepreneurs from Pennsylvania, including Kevin Burch, president of Jet Express. Burch has been in the trucking business for more than 40 years.
If Congress passes the tax relief and reform plan, Burch will be able to spend more on new equipment and training for his employees, Trump said.
The plan will also end the estate tax (or death tax), which is a tax on the transfer of the estate of a deceased person.
Repealing the death tax is important for truckers as many of them are family-owned companies and passed down from one generation to the next, according to Trump.
In addition, companies will be allowed to fully write-off or expense the cost of new equipment immediately, which is a boon for the capital-intensive trucking industry.
According to the American Trucking Association (ATA), over 70 percent of all the freight tonnage moved in the United States is transported with trucks. The sector, which is the number one employer in about 29 states, employs 3.5 million drivers around the country.
ATA President and CEO Chris Spear said in a press release: “While trucking sustains the vitality of the U.S. economy, we also carry a heavy tax burden, paying the highest corporate tax rate of any transportation mode.”
According to Spear, higher tax rates mean higher transportation costs, and more expensive goods, which hurt lower-income Americans the most.
“We urge Congress to follow the President’s lead and pass tax reform by year’s end,” Spear said.
According to Trump, the biggest winners of tax reform will be everyday families and companies that create jobs.
“It’s a middle-class bill,” he said.
“By eliminating tax breaks and special interest loopholes that primarily benefit the wealthy, our framework ensures that the benefits of tax reform go to the middle class, not to the highest earners.”
American labor bears more than 70 percent of the corporate tax burden, stated a Congressional Budget Office report. And cutting the tax rates would boost wage growth by almost four times, according to the Council of Economic Advisers (CEA).
The plan allows American corporations to bring their overseas money back to the country, and Trump claims this change, along with a lower tax rate, would likely result in a $4,000 pay raise for the typical American household.
“In 2016, American multinational companies kept 71 percent of their foreign-earned profits overseas and away from our country,” Trump said, and he promised tax reform would reverse this.
Trump also said he is currently reviewing trade deals, including NAFTA, and renegotiating the terms.
“I am right now renegotiating trade deals that are so horrendous and so one-sided and so embarrassing for our country,” he said.