Rosy White House tax cut forecast clashes with independent analysisWASHINGTON/NEW YORK (Reuters) - The White House promoted President Donald Trump’s tax cut plan on Friday with a forecast of faster U.S. economic expansion and wage growth, as independent analysts said the plan would swell the budget deficit and provide little spark to the economy. The rival projections reflected the many unknowns swirling around the plan, expected to be unveiled in legislative form on Wednesday. Republicans were still undecided on some of the hardest parts, such as how to pay for the costly cuts proposed. Weeks and possibly months of debate lie ahead for a project that Trump promised to tackle in his 2016 election campaign. In September, he unveiled a rough framework for cutting taxes. Now he wants Congress to approve a bill, which would mark his first major legislative victory, before the end of the year. The Trump plan for tax cuts of the sort normally reserved for times of economic recession is taking shape in Congress amid signs the economy is already growing briskly. Gross domestic product increased at a 3 percent annual rate in the July-September period, supported by strong business spending on equipment, the Commerce Department said on Friday. The economic recovery begun under former President Barack Obama after the 2007-2009 recession is in its eighth year and showing little signs of fatigue amid a tightening labor market. “It’s hard to say that we need to have tax cuts at the individual level ... you don’t need to provide further fiscal stimulus when the economy is already strong,” said Bernard Baumohl, chief global economist at the Economic Outlook Group in Princeton, New Jersey. Faced with improving economic prospects, Republicans have shifted their rhetoric on tax cuts away from getting the economy moving again to keeping it on an expansion track. An analysis released by White House economic adviser Kevin Hassett said slashing the top federal corporate tax rate and letting businesses write off the full cost of most capital investments immediately, as proposed in the plan, would bring faster growth and higher wages. Hassett’s projections envisioned a 3 percent to 5 percent increase in GDP that, over 10 years, could represent an additional $700 billion to $1.2 trillion in economic output. But the Tax Policy Center, a nonprofit Washington think tank, released an analysis that concluded the Trump tax plan would not produce a significant, permanent economic boost. The group said the plan would reduce federal tax revenue by roughly $2.4 trillion over the next decade and by over $3 trillion in the decade after that, adding significantly to a U.S. national debt that already exceeds $20.4 trillion. The center said Trump’s tax cuts would drive new activity at first, but that the impact would be blunted in later years by rising deficits, forcing more federal borrowing to finance the tax cuts and driving up borrowing costs for the private sector. Hassett told reporters he does not expect tax reform to add significantly to the deficit. But he conceded that it would become “a big negative” if economic growth failed to materialize and the debt level soared. The framework of Trump’s plan unveiled last month called for reducing the corporate tax rate to 20 percent from 35 percent, the small business rate to 25 percent from up to 39.6 percent and the top individual rate to 35 percent from 39.6 percent. It also called specifically for repealing the estate tax on inheritances and the alternative minimum tax, both of which are typically paid by the country’s highest-income earners. Less clear were the plan’s proposals to reduce the number of tax brackets, enhance the child tax credit and possibly put new limits on popular 401(k) retirement pension plans. Because details of the unfinished tax legislation are unknown, its economic impact is unclear, said Omer Eisner, chief market analyst at Commonwealth Foreign Exchange in Washington. Hours after the Commerce Department reported stronger-than-expected third quarter U.S. economic growth of 3 percent. Hassett said the data did not undercut the need for tax cuts. He said economic expansion and stronger stock market performance could be undermined if the Republican-controlled Congress fails to enact the tax cuts. “Firms are optimistic both because of regulatory reform but also because they expect corporate tax reform and overall tax reform,” Hassett said. “The thing that I’m worried about is that if those expectations prove to be incorrect, then I would expect business capital spending to go back to a disappointing path and equity markets to decline as well.” Kevin Brady, chairman of the U.S. House of Representatives tax committee, said progress was being made toward satisfying Republicans who have held back support for the tax plan because it could end a deduction for state and local taxes. “I’m hopeful ... we can find a good solution for them,” Brady said. politicsNews
rosy white house tax cut forecast clashes independent york reuters the white house promoted president donald trump tax cut plan friday forecast faster economic expansion wage growth independent analysts said plan would swell budget deficit provide little spark economy the rival projections reflected many unknowns stirling around plan expected unveiled legislative form wednesday republicans still undecided hardest parts pay costly cuts proposed weeks possibly months debate lie ahead project trump promised tackle election campaign in september unveiled rough framework cutting taxes now wants congress approve bill would mark first major legislative victory end year the trump plan tax cuts sort normally reserved times economic recession taking shape congress amid signs economy already growing briefly gross domestic product increased percent annual rate period supported strong business spending equipment commerce department said friday the economic recovery begun former president barack obama recession eighth year showing little signs fatigue amid tightening labor market it hard say need tax cuts individual level need provide fiscal stimulus economy already strong said bernard baumohl chief global economist economic outlook group princeton new jersey faced improving economic prospects republicans shifted rhetoric tax cuts away getting economy moving keeping expansion track an analysis released white house economic adviser kevin assets said slashing top federal corporate tax rate letting businesses write full cost capital investments immediately proposed plan would bring faster growth higher wages assets projections envisioned percent percent increase gdp years could represent additional billion trillion economic output but tax policy center nonprofit washington think tank released analysis concluded trump tax plan would produce significant permanent economic boost the group said plan would reduce federal tax revenue roughly trillion next decade trillion decade adding significantly national debt already exceeds trillion the center said trump tax cuts would drive new activity first impact would mounted later years rising deficits forcing federal borrowing finance tax cuts driving borrowing costs private sector assets told reporters expect tax reform add significantly deficit but conceded would become big negative economic growth failed materialize debt level soared the framework trump plan unveiled last month called reducing corporate tax rate percent percent small business rate percent percent top individual rate percent percent it also called specifically repealing estate tax inheritance alternative minimum tax typically paid country earners less clear plan proposals reduce number tax brackets enhance child tax credit possibly put new limits popular k retirement pension plans because details unfinished tax legislation unknown economic impact unclear said over einer chief market analyst commonwealth foreign exchange washington hours commerce department reported third quarter economic growth percent assets said data undercut need tax cuts he said economic expansion stronger stock market performance could undermined congress fails enact tax cuts firms optimistic regulatory reform also expect corporate tax reform overall tax reform assets said the thing i worried expectations prove incorrect i would expect business capital spending go back disappointing path equity markets decline kevin brady chairman house representatives tax committee said progress made toward satisfying republicans held back support tax plan could end deduction state local taxes i hopeful find good solution brady 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: Rosy White House tax cut forecast clashes with independent analysisWASHINGTON/NEW YORK (Reuters) - The White House promoted President Donald Trump’s tax cut plan on Friday with a forecast of faster U.S. economic expansion and wage growth, as independent analysts said the plan would swell the budget deficit and provide little spark to the economy. The rival projections reflected the many unknowns swirling around the plan, expected to be unveiled in legislative form on Wednesday. Republicans were still undecided on some of the hardest parts, such as how to pay for the costly cuts proposed. Weeks and possibly months of debate lie ahead for a project that Trump promised to tackle in his 2016 election campaign. In September, he unveiled a rough framework for cutting taxes. Now he wants Congress to approve a bill, which would mark his first major legislative victory, before the end of the year. The Trump plan for tax cuts of the sort normally reserved for times of economic recession is taking shape in Congress amid signs the economy is already growing briskly. Gross domestic product increased at a 3 percent annual rate in the July-September period, supported by strong business spending on equipment, the Commerce Department said on Friday. The economic recovery begun under former President Barack Obama after the 2007-2009 recession is in its eighth year and showing little signs of fatigue amid a tightening labor market. “It’s hard to say that we need to have tax cuts at the individual level ... you don’t need to provide further fiscal stimulus when the economy is already strong,” said Bernard Baumohl, chief global economist at the Economic Outlook Group in Princeton, New Jersey. Faced with improving economic prospects, Republicans have shifted their rhetoric on tax cuts away from getting the economy moving again to keeping it on an expansion track. An analysis released by White House economic adviser Kevin Hassett said slashing the top federal corporate tax rate and letting businesses write off the full cost of most capital investments immediately, as proposed in the plan, would bring faster growth and higher wages. Hassett’s projections envisioned a 3 percent to 5 percent increase in GDP that, over 10 years, could represent an additional $700 billion to $1.2 trillion in economic output. But the Tax Policy Center, a nonprofit Washington think tank, released an analysis that concluded the Trump tax plan would not produce a significant, permanent economic boost. The group said the plan would reduce federal tax revenue by roughly $2.4 trillion over the next decade and by over $3 trillion in the decade after that, adding significantly to a U.S. national debt that already exceeds $20.4 trillion. The center said Trump’s tax cuts would drive new activity at first, but that the impact would be blunted in later years by rising deficits, forcing more federal borrowing to finance the tax cuts and driving up borrowing costs for the private sector. Hassett told reporters he does not expect tax reform to add significantly to the deficit. But he conceded that it would become “a big negative” if economic growth failed to materialize and the debt level soared. The framework of Trump’s plan unveiled last month called for reducing the corporate tax rate to 20 percent from 35 percent, the small business rate to 25 percent from up to 39.6 percent and the top individual rate to 35 percent from 39.6 percent. It also called specifically for repealing the estate tax on inheritances and the alternative minimum tax, both of which are typically paid by the country’s highest-income earners. Less clear were the plan’s proposals to reduce the number of tax brackets, enhance the child tax credit and possibly put new limits on popular 401(k) retirement pension plans. Because details of the unfinished tax legislation are unknown, its economic impact is unclear, said Omer Eisner, chief market analyst at Commonwealth Foreign Exchange in Washington. Hours after the Commerce Department reported stronger-than-expected third quarter U.S. economic growth of 3 percent. Hassett said the data did not undercut the need for tax cuts. He said economic expansion and stronger stock market performance could be undermined if the Republican-controlled Congress fails to enact the tax cuts. “Firms are optimistic both because of regulatory reform but also because they expect corporate tax reform and overall tax reform,” Hassett said. “The thing that I’m worried about is that if those expectations prove to be incorrect, then I would expect business capital spending to go back to a disappointing path and equity markets to decline as well.” Kevin Brady, chairman of the U.S. House of Representatives tax committee, said progress was being made toward satisfying Republicans who have held back support for the tax plan because it could end a deduction for state and local taxes. “I’m hopeful ... we can find a good solution for them,” Brady 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: rosy white house tax cut forecast clashes independent york reuters the white house promoted president donald trump tax cut plan friday forecast faster economic expansion wage growth independent analysts said plan would swell budget deficit provide little spark economy the rival projections reflected many unknowns stirling around plan expected unveiled legislative form wednesday republicans still undecided hardest parts pay costly cuts proposed weeks possibly months debate lie ahead project trump promised tackle election campaign in september unveiled rough framework cutting taxes now wants congress approve bill would mark first major legislative victory end year the trump plan tax cuts sort normally reserved times economic recession taking shape congress amid signs economy already growing briefly gross domestic product increased percent annual rate period supported strong business spending equipment commerce department said friday the economic recovery begun former president barack obama recession eighth year showing little signs fatigue amid tightening labor market it hard say need tax cuts individual level need provide fiscal stimulus economy already strong said bernard baumohl chief global economist economic outlook group princeton new jersey faced improving economic prospects republicans shifted rhetoric tax cuts away getting economy moving keeping expansion track an analysis released white house economic adviser kevin assets said slashing top federal corporate tax rate letting businesses write full cost capital investments immediately proposed plan would bring faster growth higher wages assets projections envisioned percent percent increase gdp years could represent additional billion trillion economic output but tax policy center nonprofit washington think tank released analysis concluded trump tax plan would produce significant permanent economic boost the group said plan would reduce federal tax revenue roughly trillion next decade trillion decade adding significantly national debt already exceeds trillion the center said trump tax cuts would drive new activity first impact would mounted later years rising deficits forcing federal borrowing finance tax cuts driving borrowing costs private sector assets told reporters expect tax reform add significantly deficit but conceded would become big negative economic growth failed materialize debt level soared the framework trump plan unveiled last month called reducing corporate tax rate percent percent small business rate percent percent top individual rate percent percent it also called specifically repealing estate tax inheritance alternative minimum tax typically paid country earners less clear plan proposals reduce number tax brackets enhance child tax credit possibly put new limits popular k retirement pension plans because details unfinished tax legislation unknown economic impact unclear said over einer chief market analyst commonwealth foreign exchange washington hours commerce department reported third quarter economic growth percent assets said data undercut need tax cuts he said economic expansion stronger stock market performance could undermined congress fails enact tax cuts firms optimistic regulatory reform also expect corporate tax reform overall tax reform assets said the thing i worried expectations prove incorrect i would expect business capital spending go back disappointing path equity markets decline kevin brady chairman house representatives tax committee said progress made toward satisfying republicans held back support tax plan could end deduction state local taxes i hopeful find good solution brady said politicsnews