"This is a middle-class tax bill," Gary Cohn, Trump's chief economic adviser, told CBS This Morning. "We're eliminating the deductions that were added to the tax legislation over the years to favor the wealthy. The wealthy have deductions. Middle-income people and lower-income people don't have deductions."
Steve Mnuchin, the Treasury secretary, told Good Morning America the same. He refused to make any promises, but said his "No. 1 objective" is to make sure no one in the middle class pays more, and that another "objective" is making sure there are no absolute tax cuts for the wealthy.
The idea that cutting deductions will make the plan better for the middle class is pure nonsense. There just aren't enough deductions in the tax code to make Trump's plan anything other than a giveaway to the wealthy.
Trump would hugely cut the corporate tax (a giveaway to rich shareholders). His plan slashes the top income tax rate for high earners from 39.6 percent to 35 percent. It gets rid of taxes that overwhelmingly apply to the wealthy — Obama's 3.8 percent investment surtax, the alternative minimum tax, and the estate tax. And it would set a top rate of 15 percent for the overwhelmingly rich owners of "pass-through" companies, compared with today's 39.6 percent. Mitt Romney's tax plan in 2012 had many fewer cuts, and researchers still found it was mathematically impossible to remove enough deductions to make it not a net cut for the rich.
But the argument that Trump's plan is actually a cut for middle-class people does have some research behind it — even if the idea is still far outside the mainstream of economics. The chief proponent of the idea that cutting corporate taxes helps the middle class is economist Kevin Hassett, whom Trump has picked as chair of the Council of Economic Advisers.
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