Outside the Box: Trump’s tax plan is one big step from reality

While President Donald Trump’s latest tax plan moves in the right direction, the math still does not work.

Earlier this week in a MarketWatch commentary, I argued that Congress would likely be obliged to lower the corporate tax rate, and the related rate on partnership business income, to 25% rather than 15%. On Wednesday, Trump announced a tax framework with a 20% rate for corporations and a 25% rate for partnership business income.

So the president is halfway to reality. The Trump tax plan still costs $500 billion more than the $1.5 trillion deficit limit in the Senate budget resolution, which is needed to pass tax bills by 51 Senators instead of the usual 60.

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