Trump unveils tax reform plan in Indiana

Trump says he will simplify the tax code and ensure "historic tax relief" for all Americans.
11:02 | 09/27/17

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Transcript for Trump unveils tax reform plan in Indiana
And they have president trump live in Indianapolis. Indiana unveiling some additional. Live in New York a lot more information coming out now about exactly how president trump would like to see that tax reform plan move Ford. When break it all down right now but we know and what we still don't know. Live with us in DC my colleague Mary Alice parks and joins now Heidi given today Mary Alice Hank and and also with us in Washington DC Gary half hour Aires a senior fellow with the Peterson Institute. For international economics thanks for being with us Gary. Yeah so Mary house over to you first that we've been talking about these deet tails that got some background briefing recently about what this plan would look like this is the most information we've gotten so far about what this but look like moving full court. But that's a lot of information don't know that's left up to congress at this. Points. That's exactly right and we still don't have a bill so there are a lot of questions about. How some of this framework will actually play out there's no tax yet. Four experts to digest. So Gary let's talk about what we do know right now we've gotten some bullet points from the administration. There's a proposal to lower the corporate tax rate a proposal to lower the top individual tax rate repealing the estate tax. Doubling some deductions for individuals and couples expanding the child tax credits what's your assessment. So far based on the plan as we've seen it from the administration. I thought certain trumpet and extremely powerful speech. He really played on two themes jobs. And very nationalistic. Point of view. Bernard project in many governments and work order correct that situation. If you look at the framework so far we know what man. Al. About half the bucks. 02 individuals. Including yesterday to act that's not a big item but he made by a cigarette here in Indiana. And that those cuts amount to a route. Three trillion dollars according to its members actually. The other half go to business corporations. And Sobel passed through. Business partnership shook up. And support that's about two point eight trillion on the other hand these. Two you're way. Now limiting. But right deductions. Both on the individual side. And the personal side and read you'll be arithmetic than net. Cost. Over a decade of this. Framework might be about 2.2. Trillion dollars. Election big number. Will shoot you or your congress wants to. The picket opposite. But usually over the next ten years. And there will be when they're scrambling between these. Individuals slide of the program. And opinion site. I really like most of that there's I think he's I agree with the president. That are rich or what outline. Their expensing. Discussed at lighting up immediately. Any equipment that firm buys. Are those and that is. I think we're having some double and a connection and with a wary. Gary Phelan I'm so sorry to interrupt here we're having a little bit of connection issues for these are gonna see if we can fix that before we come back to you Mary Alice. Let me come back to you on this point part of this is messaging and big part of that's from the administration. We heard president there use the words historic when it comes to this tax reform plan. And middle class miracle there's a lot of talk. About what this we do for working class families for middle class families although this does get quite a benefit to top earners in our tax brackets. And that part of this will be a top sell Republicans ABC had a recent poll that said that 65 Americans RD bank. That corporations and large businesses pay too much in tax it so here we have a new tax plan which dramatically. Well but you're right there's this other part of the plan that can be pretty easy sell for Republicans if they can convincingly. Make a case that this will result in more money in your pocket. More money in the average American's pocket. That's a pretty good selling point so I think it'll be checking for them to walk that fine line but but not impossible. By and large this much less emotional issue than health care. I don't think we're gonna see this same level of emotional response to this plan as we did during health care debate this summer. So let's bring in our colleague Alex mount is actually traveling with the president and joins us live now. From Indianapolis there Alex I think the friendly crowd in the room we saw how well the president's words. Went down there but talking in the debate about the White House's approach to tax reform Vick this president comes we'll house. Health care relegated to you know on the that your earlier from the sidelines you guys work out the details in congress if he can be more involved in bet. Moving forward. The different approach this plan. Picked the there's typical liberal Democrat leaders we currently. I think we're having some gremlins in the issues today there to try to check back with Alex Mallon if we can eat in the field they're traveling with the president Mary Alice where credit is gonna come back to you. Once again and I want to play you a sound bite from earlier today because before he laughed Washington DC president from. Was answering some questions about many of these top issues he's facing right now specifically. About tax reform he was asked about what this when in fact this would have on people up high wealth a top earners. In the country specifically if he personally. Would benefit from it and take a listen to what he had to say. And Mary out this is gonna be a bit of a typical case for that president himself to make moving toward this a clear line in the proposal that says. The top individual tax rate would be cut to 35 per cent how to move forward trying to defend the idea that he wouldn't benefit from it in some way. Right there's also a huge drop in the corporate tax rates I think you're exactly right that's going to be a very tricky messaging point for the Republicans and the Democrats. Know that there RD pouncing on this you've seen statement after statement from Democrats today saying this is just a windfall for people like president Trout. Huge tax break for the wealthiest Americans and you I think what's and it's interesting that at the economists is with us brought up with the idea that. This is gonna cost the federal government a huge amount of money and last Republicans find a way to offset that cost. And so far some of that proposals receiving money. The Republicans are on the table haven't been flat tax cuts to Medicare and Medicaid. So that's a tricky messaging point two how do you say. That you want to have. A tax plan that benefits corporations and you're gonna pay for it. By taxiing by and I changing how you pay for. Some these very popular programs that benefit lower income Americans so it's true I think that you're about B rent is going to be tough messaging out of Republicans had. Well let's take into that went a little bit more I think we have Gary half hour back with us from the Peterson Institute Gary let me put that to you. It's impossible to say at this point without some of the elimination some of the cost savings that they hope to make with previous legislation that failed. That this would not add to the deficit in some way the administration is basically saying that we hope when you account for the elimination of tax breaks. And our proposed economic growth that would make up the difference do you see those two coming together. I think there argument would be that the growth. Can be much faster and back president trump made some some of that and he has a 3% growth target it we actually got 3%. Then the deficit. Burden that is. Much less maybe just finishes in ten years climb a lot of economists are very skeptical about they're out on the point of the corporate tax. Kutcher calling was quite right that's will be eight and they've got debating issue in the country and in the congress. The president's trouble argument your debt cutting the corporate greed is what I preach the jobs. He made our strong sales on that if you're pretty if the congress and the people by. I will accept the cut in the corporate rate they're they don't quiet stable it's about is simply that. Kim let me follow up and you a little bit more hopefully you can provide some historical context here because. If we let history be our guide the last time the experience any kind of sweeping tax reform and this level was under President Reagan. We saw him then NBC president trump now drawn a pretty Linear line lower the taxes you have more jobs you have higher wages the economy grows. It's what we actually saw back then Arctic conditions at the scene today. I know the conditions the conditions are not the same and up mode president prompts characterization now. Reagan and what your summary. Are often have been very important way. He it is true that President Reagan lowered the rate. We got down to this roughly a period 5% rate. But at the same guy Reid took away a lot of the spent. Should the or shall I actually be reduced taxes did not and I want to emphasize did not fall under the Reagan program. Individual characters. Did poll law and it's true we had great times in the night but there are reports a lot else happening in the economy. In terms of technology and so forth. It was a good naked I I think the conditions now. Or or quite a bit. Get different I don't think we have the technological. We can end right now are actually we enjoyed in the 1990. RA Gary half hour from a senior fellow at the Peterson institute for international economics think you so much for making the times are. Thank you.

This transcript has been automatically generated and may not be 100% accurate.

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