- The Washington Times - Friday, February 24, 2017

Congressional Republicans, along with President Trump, need to pass a tax cut on businesses — stat.

U.S. economic growth has been anemic, and there’s no faster way to jump-start the economy than by cutting the world’s highest business tax rate of nearly 40 percent to that of 15 percent to 20 percent.

The stock market has been soaring on Mr. Trump’s promises of deregulation and tax cuts. If this doesn’t happen this year, the market will surely readjust, downward, and Mr. Trump’s promises of job growth and wage increases won’t be realized.

Republicans are haggling over a so-called border-adjustment tax, which is featured in House Speaker Paul Ryan’s “A Better Way” plan. He needs to ditch it, so the process can be sped up.

The border-adjustment tax has divided the business community — between those who import the majority of their products (retailers such as Wal-Mart) and those who export (manufacturers such as Caterpiller). The reason for it is to help pay for the tax cuts, so they don’t add to the deficit.

Although it may pass through the House, Senate Republicans won’t go for it. Additionally, it doesn’t have a White House buy-in, yet.

And it never should.

For starters, it’s a liberal way to think about things — taking from (i.e., taxing) importers and giving to exporters. The tax also, inevitably, will be passed along to the consumer in the form of higher product prices.

A tax cut on businesses will pay for itself, by growing the economy. So far, U.S. GDP has been stuck at 2 percent annually. The Tax Foundation, over the long term, found a business tax cut would spur that growth to about 4 percent annually — more than doubling it.

Businesses, instead of holding onto their cash, will start reinvesting it. They’ll build bigger plants, hire more workers and pay them a better salary. The workers will then take their money and buy more products — there will be an economic boom.

So what about the deficit?

Well, for every percentage point increase on the GDP baseline of 2 percent, will translate into a $3 trillion deficit reduction over a period of 10 years. And here’s a revolutionary thought: The government could start spending less, cut a few frivolous programs and start deconstructing the federal bureaucracy.

Economists Larry Kudlow and Steven Moore, who helped develop Mr. Trump’s economic policy, recommend a business tax cut, coupled with an infrastructure investment plan and a 10 percent repatriation tax of foreign profits brought back to the U.S., wrapped up into one bill.

To encourage businesses to start investing now, make the tax cut retroactive to the start of 2016.

Democrats would be pressured to vote for the measure, because of the infrastructure spend, and Republicans would get the tax cuts they need. It could pass, separately, with 60 votes in the Senate. It sounds like a good deal to me.

Mr. Ryan’s “Better Way” agenda was crafted under the assumption that Hillary Clinton would be president. It’s time to start over now that Mr. Trump’s in charge.

Congressional Republicans need to get on board and into action. Time is of the essence.

Once taxes on industry are implemented, the longer, tougher battle of tax reform can be fought.

That’s the way Ronald Reagan did it. And that’s what led to the economic boom of the 1980s and 1990s. It’s time for Mr. Trump to get started, with help from his party in Congress.

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