Wealthy financiers could gain from Trump's proposed tax cut for small businessesWASHINGTON (Reuters) - High-income Wall Street financiers could be unintended winners from a section of U.S. President Donald Trump’s tax-cut plan that is meant to help mostly small, “mom-and-pop” businesses. Trump called on Wednesday for a new “pass-through” tax rate of 25 percent that could mean big savings for owners of sole proprietorships and partnerships who now pay 39.6 percent. But it could also mean a windfall for partners in private-equity, venture-capital and hedge funds, unless Congress can figure out a way to block them from taking advantage of the new rate. Ron Wyden, top Democrat on the tax-writing Senate Finance Committee, said Democrats supported a pass-through rate for small businesses, such as “a cleaner, a garage, a restaurant.” He said Trump’s plan, however, would create “a whole new set of wealthy individuals being able to dodge their taxes through this new provision.” At issue is the taxation of the roughly 95 percent of American businesses that are not public corporations. Non-public pass-through businesses, such as sole proprietorships, limited liability companies and partnerships, pay no income tax themselves. Instead their profits “pass through” directly to their owners, who pay tax on them at the individual tax rates. A small fraction of those business owners pay the top individual tax rate of 39.6 percent, higher than the current top corporate income tax rate of 35 percent. Those business owners have long complained that the disparity is unfair, especially in view of the fact that many multinationals pay much less than the 35 percent statutory corporate tax rate by exploiting abundant loopholes and tax breaks available to large, global corporations. Republicans have been eager to address the issue. Trump’s plan proposes a new tax rate of 25 percent for the pass-through income of “small and family-owned businesses.” The problem, according to the plan’s critics, is that financial entities such as private-equity, venture-capital and hedge funds are all partnerships whose wealthy partners would see substantial tax savings on large portions of their income unless congressional tax writers find a way to exclude them. ‘GOOD’ VERSUS ‘BAD’ PASS-THROUGH INCOME The White House document that spelled out Trump’s plan signaled that the administration was aware of the potential problem but would leave addressing it up to Congress. The document said: “The framework contemplates that the (congressional tax) committees will adopt measures to prevent the recharacterization of personal income into business income to prevent wealthy individuals from avoiding the top personal tax rate.” Trump’s plan also proposes cutting the top corporate tax rate to 20 percent from 35 percent and cutting the top individual tax rate to 35 percent from 39.6 percent. Treasury Secretary Steven Mnuchin said two weeks ago that the administration would ensure partners at services firms such as accounting, law and financial firms would not benefit from a new, lower pass-through rate. A Treasury Department spokesman did not respond to a request for comment on the pass-through rate or plans to exempt certain categories of firms. Frank Clemente, executive director of Americans for Tax Fairness, a liberal advocacy group, said the idea that a new pass-through rate would help small business was “simply a hoax.” Tax experts said it would be difficult for congressional tax writers to exempt partners at services firms from using the new pass-through rate. “There has always been talk of how to carve out ‘good’ pass-through income from ‘bad’ pass-through income. The problem is it’s exceedingly hard to do and there is no way to draw clear lines that won’t be manipulated,” said Seth Hanlon with the Center for American Progress, a liberal group. Victor Fleischer, a law professor at the University of San Diego, agreed it would be “challenging.” “Still, I think it can probably be done,” Fleischer said. politicsNews
wealthy financiers could gain trump proposed tax cut small businesseswashington reuters wall street financiers could unintended winners section president donald trump plan meant help mostly small businesses trump called wednesday new tax rate percent could mean big savings owners sole proprietorships partnerships pay percent but could also mean landfall partners hedge funds unless congress figure way block taking advantage new rate ron widen top democrat senate finance committee said democrats supported rate small businesses cleaner garage he said trump plan however would create whole new set wealthy individuals able dodge taxes new at issue taxation roughly percent american businesses public corporations businesses sole proprietorships limited liability companies partnerships pay income tax instead profits pass directly owners pay tax individual tax rates a small fraction business owners pay top individual tax rate percent higher current top corporate income tax rate percent those business owners long complained disparity unfair especially view fact many multinational pay much less percent statutory corporate tax rate exploiting abundant loopholes tax breaks available large global corporations republicans eager address issue trump plan proposes new tax rate percent income small the problem according plan critics financial entities hedge funds partnerships whose wealthy partners would see substantial tax savings large portions income unless congressional tax writers find way exclude good versus bad income the white house document spelled trump plan signaled administration aware potential problem would leave addressing congress the document said the framework contemplates congressional tax committees adopt measures prevent characterization personal income business income prevent wealthy individuals avoiding top personal tax trump plan also proposes cutting top corporate tax rate percent percent cutting top individual tax rate percent percent treasury secretary steven mnuchin said two weeks ago administration would ensure partners services firms accounting law financial firms would benefit new lower rate a treasury department spokesman respond request comment rate plans exempt certain categories firms frank clement executive director americans tax fairness liberal advocacy group said idea new rate would help small business simply tax experts said would difficult congressional tax writers exempt partners services firms using new rate there always talk carve good income bad income the problem exceedingly hard way draw clear lines manipulated said seth hanson center american progress liberal group victor fletcher law professor university san diego agreed would still i think probably done fletcher said politicsnews
Your task is to classify the provided input as real or fake news. Label 0 is meant for fake news, Label 1 is for real news. TEXT: Wealthy financiers could gain from Trump's proposed tax cut for small businessesWASHINGTON (Reuters) - High-income Wall Street financiers could be unintended winners from a section of U.S. President Donald Trump’s tax-cut plan that is meant to help mostly small, “mom-and-pop” businesses. Trump called on Wednesday for a new “pass-through” tax rate of 25 percent that could mean big savings for owners of sole proprietorships and partnerships who now pay 39.6 percent. But it could also mean a windfall for partners in private-equity, venture-capital and hedge funds, unless Congress can figure out a way to block them from taking advantage of the new rate. Ron Wyden, top Democrat on the tax-writing Senate Finance Committee, said Democrats supported a pass-through rate for small businesses, such as “a cleaner, a garage, a restaurant.” He said Trump’s plan, however, would create “a whole new set of wealthy individuals being able to dodge their taxes through this new provision.” At issue is the taxation of the roughly 95 percent of American businesses that are not public corporations. Non-public pass-through businesses, such as sole proprietorships, limited liability companies and partnerships, pay no income tax themselves. Instead their profits “pass through” directly to their owners, who pay tax on them at the individual tax rates. A small fraction of those business owners pay the top individual tax rate of 39.6 percent, higher than the current top corporate income tax rate of 35 percent. Those business owners have long complained that the disparity is unfair, especially in view of the fact that many multinationals pay much less than the 35 percent statutory corporate tax rate by exploiting abundant loopholes and tax breaks available to large, global corporations. Republicans have been eager to address the issue. Trump’s plan proposes a new tax rate of 25 percent for the pass-through income of “small and family-owned businesses.” The problem, according to the plan’s critics, is that financial entities such as private-equity, venture-capital and hedge funds are all partnerships whose wealthy partners would see substantial tax savings on large portions of their income unless congressional tax writers find a way to exclude them. ‘GOOD’ VERSUS ‘BAD’ PASS-THROUGH INCOME The White House document that spelled out Trump’s plan signaled that the administration was aware of the potential problem but would leave addressing it up to Congress. The document said: “The framework contemplates that the (congressional tax) committees will adopt measures to prevent the recharacterization of personal income into business income to prevent wealthy individuals from avoiding the top personal tax rate.” Trump’s plan also proposes cutting the top corporate tax rate to 20 percent from 35 percent and cutting the top individual tax rate to 35 percent from 39.6 percent. Treasury Secretary Steven Mnuchin said two weeks ago that the administration would ensure partners at services firms such as accounting, law and financial firms would not benefit from a new, lower pass-through rate. A Treasury Department spokesman did not respond to a request for comment on the pass-through rate or plans to exempt certain categories of firms. Frank Clemente, executive director of Americans for Tax Fairness, a liberal advocacy group, said the idea that a new pass-through rate would help small business was “simply a hoax.” Tax experts said it would be difficult for congressional tax writers to exempt partners at services firms from using the new pass-through rate. “There has always been talk of how to carve out ‘good’ pass-through income from ‘bad’ pass-through income. The problem is it’s exceedingly hard to do and there is no way to draw clear lines that won’t be manipulated,” said Seth Hanlon with the Center for American Progress, a liberal group. Victor Fleischer, a law professor at the University of San Diego, agreed it would be “challenging.” “Still, I think it can probably be done,” Fleischer said. politicsNews
Your task is to classify the provided input as real or fake news. Label 0 is meant for fake news, Label 1 is for real news. TEXT: wealthy financiers could gain trump proposed tax cut small businesseswashington reuters wall street financiers could unintended winners section president donald trump plan meant help mostly small businesses trump called wednesday new tax rate percent could mean big savings owners sole proprietorships partnerships pay percent but could also mean landfall partners hedge funds unless congress figure way block taking advantage new rate ron widen top democrat senate finance committee said democrats supported rate small businesses cleaner garage he said trump plan however would create whole new set wealthy individuals able dodge taxes new at issue taxation roughly percent american businesses public corporations businesses sole proprietorships limited liability companies partnerships pay income tax instead profits pass directly owners pay tax individual tax rates a small fraction business owners pay top individual tax rate percent higher current top corporate income tax rate percent those business owners long complained disparity unfair especially view fact many multinational pay much less percent statutory corporate tax rate exploiting abundant loopholes tax breaks available large global corporations republicans eager address issue trump plan proposes new tax rate percent income small the problem according plan critics financial entities hedge funds partnerships whose wealthy partners would see substantial tax savings large portions income unless congressional tax writers find way exclude good versus bad income the white house document spelled trump plan signaled administration aware potential problem would leave addressing congress the document said the framework contemplates congressional tax committees adopt measures prevent characterization personal income business income prevent wealthy individuals avoiding top personal tax trump plan also proposes cutting top corporate tax rate percent percent cutting top individual tax rate percent percent treasury secretary steven mnuchin said two weeks ago administration would ensure partners services firms accounting law financial firms would benefit new lower rate a treasury department spokesman respond request comment rate plans exempt certain categories firms frank clement executive director americans tax fairness liberal advocacy group said idea new rate would help small business simply tax experts said would difficult congressional tax writers exempt partners services firms using new rate there always talk carve good income bad income the problem exceedingly hard way draw clear lines manipulated said seth hanson center american progress liberal group victor fletcher law professor university san diego agreed would still i think probably done fletcher said politicsnews