But all other deductions, except for mortgage interest and charitable contributions, would be eliminated, including state and local taxes and medical expenses.
The proposal calls for reducing the number of tax brackets from seven to three for individuals. Interesting how Trump slammed Obama in the past for having only 2.6 percent of growth in 2015, yet his plan won't offer much more than that. Some of the changes could significantly lower the tax bill of Californians.
Almost doubling the standard deduction for married couples, from $12,600 to $24,000.
Again, without Trump's tax returns, it's impossible to say which breaks in those broad categories he relies on to reduce his taxable business income.
"Can you guarantee that no one in the middle class is going to pay more?"
A day after unveiling a plan that promised tax relief for "middle-income families", Treasury Secretary Steve Mnuchin said Thursday that he can't guarantee that those same families would see their taxes lowered.
Dropping it from the bill would make it even more hard to ensure that tax reform is revenue neutral, or doesn't add to the deficit. Though there would surely be changes made to any administration plan once it reaches Congress, having the president present a coherent vision of a policy gives lawmakers a useful starting point. But there's no detail on which incomes fall under each bracket.
Retailers and other big importers have railed against the proposed tax, saying it would lead to higher prices for consumer goods.
"I think the American population has plenty of information", said Mnuchin, who - inaccurately, the AP noted - suggested that Trump "has given more financial disclosure than anybody else". For instance, the administration wants to eliminate taxpayers' ability to deduct state and local taxes on their federal returns, which would hurt the constituents of some Republicans in Congress.
The president also wants to get rid of the estate tax. When you have a state like ours that is high-tax, high-income, you have to balance off. "You can hire more people, you can expand your business things like that". Claudia Tenney, a conservative-leaning Republican who represents parts of central NY, said until the state overhauls its own tax codes, New Yorkers "cannot afford" to lose their itemized deductions because the benefit offers state residents one of their few forms of tax relief. This would also create a huge incentive for wealthy Americans to turn their earnings into pass-through income in order to avoid paying higher personal income tax rates. The current rate is 28% for income that qualifies, and it hits individuals who otherwise would benefit from a sharply lower effective tax rate because of deductions.