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Tax Cut 2.0 Expected by Summer

Posted on Jan. 16, 2020

The Republican party is gearing up to introduce a new tax package in the summer to help middle-income Americans, the president’s top economic adviser said.

National Economic Council Director Larry Kudlow said in an interview with CNBC January 15 that he’s exploring a “Tax Cut 2.0” package to complement the Tax Cuts and Jobs Act. “We’re many months away; it’ll come out sometime later during the campaign,” he said.

Kudlow said he met with House Ways and Means Committee ranking member Kevin Brady, R-Texas, regarding the plan. Brady told Tax Notes that they are still in the early discussion stages, but that the goal is to deliver more for middle-income taxpayers and make the tax code as competitive as possible. Brady said economic growth and a pro-worker tax code are priorities for President Trump.

One important goal for Brady is to make the individual tax cuts of the 2017 tax law permanent. “That is going to create 1.5 million new jobs,” he said, adding that he will be speaking with Trump about it.

The individual tax cuts in the TCJA are scheduled to expire by 2025. Brady said the president wants to do more than just make the individual tax cuts permanent. Brady has talked about lowering the 22 percent middle-income tax bracket. Kudlow hinted at a 15 percent tax bracket in his interview.

Talks between the White House and Republican lawmakers to further cut middle-income taxes have been ongoing since last year.

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