- REUTERS/Shannon Stapleton
When Donald Trump was asked to name the leaders of foreign terrorist groups earlier this month, he awkwardly stumbled and suggested it wasn’t important for him to know the difference between some of those groups.
So you can forgive one of the most important conservatives setting the nation’s tax policy for being skeptical of Trump’s tax plan.
“How serious it was surprised me. … Writing a piece of legislation, let alone tax legislation, is a very serious thing to do,” Grover Norquist, the founder and president of the group Americans for Tax Reform, told Business Insider in a conversation on Monday.
“When he can’t pronounce foreign leaders’ names, it leads you to believe he might not release a serious tax plan. “This is a sophisticated, grown-up tax plan.”
Trump’s tax plan impressed Norquist, who is perhaps the single most important person in the conservative orbit for a Republican presidential candidate to impress on tax policy. Norquist crafted the famous “pledge” to not raise taxes, one that’s signed by the vast majority of Republican candidates.
Trump’s plan, observers noted upon its release, was decidedly more conventional than his vague, more populist rhetoric on the campaign trail this summer might have suggested. It also conformed to the boundaries of Norquist’s pledge by being revenue neutral.
The proposal aligned with many broad Republican goals on tax policy. It attempts to simplify the tax code by shrinking the number of income-tax brackets from seven to four; ends the “death” or estate tax; eliminates some loopholes aimed at wealthier individuals; gets rid of income tax for individuals making less than $25,000 or joint filers making less than $50,000; and reduces the corporate tax rate to 15%, which Norquist praised as “the best way to make the US competitive internationally.”
Norquist identified one notable missing element for which conservatives often advocate in tax reform: Trump’s plan would not move closer to full expensing of business fixed investment, which refers to business investment in physical assets. Those assets are currently deducted over a span of several years – Norquist and other conservatives want those assets deducted in a single year.
But Norquist praised the plan’s practicality. He said it would likely earn the support of every Republican in Congress, and noted it’s on the same page with plans and ideas from Rep. Paul Ryan (R-Wisconsin), the chair of the powerful House Ways and Means Committee, and Sen. Orrin Hatch, the chair of the Senate Finance Committee.
Said Norquist: “If you’re president and you’re trying to pass a tax bill, being where Ryan/Hatch is is important.”