On Wednesday, Republican leaders in Congress and the Trump Administration released their “Unified Framework For Fixing Our Broken Tax Code.” As the leaders noted upon its release, this document represents the consensus position of the House, Senate, and White House on tax reform.
While the plan had a number of specifics – such as the proposed rates for ordinary income, pass-through business income, and corporate income – a number of details were left out. The expectation is that the tax writing committees in the House and Senate will take the framework as a baseline, and fill in the details through the committee process.
Among the highlights in the plan are:
- A 20 percent corporate tax rate
- Pass-through income capped at 25 percent
- Individual rates of 12, 25, and 35 percent (with a possible fourth bracket above the 35 percent bracket)
- Repeal of the estate tax
- Repeal of both the individual and corporate Alternative Minimum Tax (AMT)
- Elimination of most itemized deductions for individuals except for mortgage interest and charitable giving
- Capping net interest deductions
- Moving to a territorial system of taxation for multi-national businesses
AGC issued a supportive statement of the framework, calling it “a step in the right direction” but noting that tax reform and an infrastructure package should move together. As the Committees work to fill in the details, AGC will work to ensure that the construction industry’s priorities are satisfied.
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