Senator Hatch says 25 percent corporate rate a challenge in tax reform

Reuters News
Posted: Jul 31, 2017 3:05 PM

By David Morgan

WASHINGTON (Reuters) - Congressional Republicans and the Trump administration will face a challenge reducing the U.S. corporate income tax rate to 25 percent from 35 percent, let alone to the 15 percent rate being advocated by President Donald Trump, the Senate's top tax law writer told Reuters on Monday.

Republican Senator Orrin Hatch, discussing the outlook for overhauling the tax code after last week's collapse of a push to dismantle Obamacare, said in an interview that it was time to tackle taxes despite Trump's calls for a new healthcare push.

On the corporate rate, a key concern for financial markets, the Senate Finance Committee chairman said: "The president said he wants to get it down to 15 percent. That's very unlikely. 

"In fact, it would be kind of miraculous if we could get it down to 25 percent or less," Hatch said. "I'd like to get it down to around 20 percent. I'd love to get it at 15 percent if we could.

"If we could get the corporate tax rate down to, let's say, a maximum of 25 percent, it would be a sea change for this country. It would be great," he said. "But I think the odds are, we’re going to be lucky to get it down at all."

Hatch said getting tax legislation to Trump's desk could need support from Democrats, and called on Senate Democratic leader Chuck Schumer to "open the door" to cross-party cooperation.

"In this current Congress, it’s almost impossible to change because the Democrats have just about slowed everything down to such a point that we can’t hardly move on anything. But I’m going to try to break through and get this done."

Separately, White House economic adviser Gary Cohn underscored Trump's commitment to tax reform this year

"We just had a Cabinet meeting. ... The No. 1 topic at the Cabinet meeting was talking about taxes and tax reform and what it would take to get tax reform done this year," Cohn, director of the National Economic Council, said at the start of a listening session on taxes with real estate industry groups.

(Reporting by David Morgan; Additional reporting by Susan Cornwell; Editing by Kevin Drawbaugh and Jonathan Oatis)