Transcript for Breaking down Trump's tax reform goals
And there you have Treasury Secretary Steve in action and national economic director Gary. And saying I highly anticipated press conference today. Lie in New York. We'll for the first time we've got some kind of an outline and a few details about what exactly tax reform it look like. Under president trump are gonna break at all down right here Kelly what it means for you what we know and what we don't know. Joining me live here in New York summit you know a lot about what we heard about. Eight it is Teepen is an economic or minor actor thanks for being here eight yeah. Not tie the details there but we did get some outlines an intention and what they planted and I think the biggest thing for people. Well court listening right now and we still are waiting on lots of di tale here that that's sort of the overarching point but that's standard deduction. Increasing that standard deduction doubling it right now asked standard deduction for an individual 6300. Dollars they either pointed double standard deduction. Meaning if you made 50000 dollars last year and you took that standard deduction now. You would get taxed on 37400. Dollars but that's double that the 6300. Number is basically the bottom line here is. You will pay taxes on less of your income. By taking a larger standard deduction and that's going to be something that impacts people across the port but some of the other things that are going to impact. Businesses specifically. Businesses backed corporate tax rate at number one thing that we've been hearing a lot about very specific needs help coming in. Not a surprise there they say they want lower tip 15% it also. The number of tax brackets in this plan from seven to now three tax brackets 10% 25%. And 35%. One thing missing from this conversation is who actually falls into those tax bracket ready. They didn't delineate that may they talked a lot in the conversation about the fact that they're going to be reaching out that they're gonna talk to Republicans that they're going to be listening. To get if that's for. Well what people watch how the details and mainly back. Right for a little bit or those details a spring in our conversation down in are our colleague had an eight feet Rick Klein ABC's political director. Join us there here at epic own and. Good guys that they'll only a page to read this scene. This is easy for political reporters like me that that against the re long things like I'm good restore thing. Well let's go through what we know on the short things first of all not a terrible surprise right that we don't have eternity chills yet they say they're working. We have Republicans in congress to figure out where it goes from here what we know about where those conversations are how they could report. They're not nearly as far along as the White House is making it sound personal this seems a lot more like a campaign style set of principles and does actual legislation we know that. They've been in office for more than three months that they've been working on this very hard to bring approaching the hundred days this is nowhere near close to being bait. This is doll lot of work ahead of it sounds like they're going to be spending the month of may. Meeting with stakeholders I near ironing out that he tells. But they are starting with the candy there is almost nothing in here that wouldn't be hugely popular to taxpayers because all they're doing here. Is expanding tax cuts with of the eight promised to eliminate. Some of the tax breaks that people take advantage of you heard Gary Cohn that the senior economic advisors say this is gonna me lower taxes for people. So could be geared to making a clear priority toward that which is very popular among politicians of all stripes. And against deficit reduction there's nothing here that that makes it hard for anyone to swallow. I haven't seen any indication in in what they put out so far of any individual taxpayer a corporate taxpayer. Anyone who's gonna end up paying more in taxes so again that's very easy to deliver on its that you start to get the details. Let's look at what we do you know Rebecca based on summit this that this this would have it backed the simplifying. The actual process of filing your taxes right right over the details we half exactly and one of the things that he's not here in the one cheap but that they talked about eliminating. Deductions except for cues make that for personal tax deductions other than. Mortgage interest and charitable deductions they would eliminate others that that's one piece of maybe how they would paper summit this but. Rick one of the things I think is always going to be an issue here is how this plan is paid for. And in that press conference we just heard east that it would be paid for with wrote. The cut deductions and the closing loopholes now that growth is one of the most contentious ideas and all of this because. The idea is that the economy would have to be cut that these tax cuts wrote at such a rate that companies and individuals would make so much more money. That paying a lower tax rate would still amount Q. A bigger. Tax revenue pie out that's that's a huge assumption and a lot of analysts and economists who looked at these plans. At least the basic eight count that we have. Don't necessarily believe that we could get that 4% GDP growth that would be necessary in order to generate the kind of growth to make a plant like this revenue neutral talked about deficits. Those are obviously going to be an issue that pop up Rick. Going forward with both Republicans. As well Democrats. No question and and I remember back to when President Bush came into office and pushed forward. Tax cuts that we're gonna pay for themselves because of growth obviously that growth never materialized you can assume a balanced budget if you wanna say that we're gonna have hundreds and growth that's great. On paper it all sounds really good but. Republicans have made their Matra over the last decade or so the needs it. To have things be revenue neutral not impact the deficit and I think a very big indication out of this White House their definition of deficit neutrality adding that deficit is now a different target that it was in the past. Yes there will be some new revenues from public cutting loopholes but they're taking away the biggest adoptions in the mortgage and charitable contributions that you mention. And they are going to include growth estimates in those numbers so they're gonna assume that this puts a hyper boost on the economy. That allows us to grow our way out of deficit situations those assumptions I should note. That Republicans never let. President Obama get away with it even would let President Bush get away with them toward the end of his term. If they go along with this and that's a very big yep they will be changing the rules in the middle of the game in a big fashion. So written to be fair that has never stopped anyone Democrat or Republican for moving forward and legislative efforts changing the rules a long way. But what are the chances they get on orbit as I mean this goes against a lot of what speaker Ryan has been talking about for years and years the specific that his plan as well. But this administration also and Republicans need a legislative win of some kind. Yeah and here's what's intriguing is that the same fault lines that sank the health care bill a couple weeks ago. Make themselves evident in this fight a if if members of the freedom caucus are true to their word about worry about the deficit bankrupting the country. They're going to be really worried about this it's gonna be decision time for them to test their morals that that's their values. When it when you have to digest this and when they start offering this input to the White House. There are deficit hawks in congress who have to had to be throwing their shoes of the TV listening to the senior economic team say that you're gonna grow your way out of this that's just not. The game that they've played before there's no evidence that it that it's gonna work as easily. As it does now the point you make about the need for a window is very real and it's no mistake if this is happening in the closing days of those first 100. Republicans I've talked to know that they need points on the board they've also made a point that the Republicans can't agree on taxes what can they agree that's even more. Fundamental to what it needs to be Republican in opposing obamacare. But the details are so tricky and you're operating in a world of deficits of dad. And in with a president that has been on the record on every side of this and many other issues. He said during the campaign that he would increase taxes on people like himself he looked at areas that that wealthier taxpayers have to pay more. That's all disappeared back when he thought about running for president in 1999. He proposed what he said at a time would be the largest tax increase in the history. A wealth tax that would affect all built millionaires and billionaires and would have erased that deficit of course that that's never gonna happen. I think that now we ability is is bowl the potential. Four for partnerships and it's also a potential detriment is going to be hard to see where this White House resides part of the square that with these very real divisions aside the Republican Party. Wits and actually put that graphic back up that we had just a second ago that are laid out the plan as the administration has presented its Oak Park mr. Beck wanna get your take on it. To Rick's point that this is all candies right now based on what we know which is again. Just one sheet of paper. Cool it did this appeal to Cortes is not to appeal to. Out of me everything we've got up or right now appeals to everybody is watching. Real changed because you've got the doubling of the standard deduction. You've got tax relief for families with children dependent care expenses we don't have up there however is repealed the death tax that's the inheritance tax write that I nearly impacts. Really wealthy individuals who passed away and they passed them ideologues and their family. That would be taxed under current tax life it repeal that then anybody who. Leaving it major amount of money or eight Ericsson to their family the family gets collect the entire bank act also businesses will fail have up on the screen but one of the big things at least as we have here. Is for businesses that lower corporate tax rate 15% at it literally. For a number of American companies that difference billions of dollars in tax bill at and other eat here this is something that we. Talked a lot about and the president talked a lot about this idea. Repatriation. So a number of US companies have. Literally trillions of dollars weeding overseas right now and it may yet read at least for a one time thing get rid of tax that it would cost companies to bring out from overseas backed the United States. That would be huge savings out. There are lots of economists believe that act coolant that money bringing out acts the United States could you helped battery wrote your question is. How companies ultimately spat at you based on hiring based on investing in their business. Or. Are they buy back stock. Those two things have very different outcomes the American. Directed a lot in there and members of congress are gonna have to guess about the going to be some speculation is going to be some calculations run some people are gonna predict what kind of effect that has. But they're gonna have to make a choice right. Speculation and negotiation. I think it was interesting to see them lead with this as principals say they're open to this dialogue we have these core principles he's the things are not gonna negotiate around. Most of them reflect promises that president prop made one telling detail though when now when Gary Condit that that the economic advisor. Was asked at the briefing how does this impact in these individual things he's a look these are micro details. Everything about tax policy is my critique else that's the point that's why it's hard. So it's easy to put the big principles out there but acted to jam those in to legislation to make it something. That actually works that it's gonna get a majority of house members of super majority sixty senators on board. Gonna have a comfort of the American people to do all of this when the White House hasn't demonstrated any propensity for that so far hasn't seen to have engaged in any that he tells yet. I mean count me among the skeptics it this is going to be very difficult month and there's a reason. That taxes have not been reformed in a major way in more than three decades. Let's take a little we know about how people feel about tax reform Odyssey people hear the phrase and they think I want lower taxes. We have some numbers around that there's a poll that ABC's conducted this was act in January so. I'm not sure there are more. Numbers that they scale recently but I think we've got this and it graphic form. We'll show to you in the second. They're breaking big picture when people are asked. Whether or not they support reducing. Taxes for various groups businesses. Or middle and lower income people are higher income people Odyssey a vast majority that in fact percent that gas would love to see lower taxes for middle and lower income people. Fewer Americans though would support the idea of reducing taxes for businesses and higher income people so how does a plan like that go over with those Americans. One that's for that he tells become important because these are the things you can poll testing get all of 7580%. He was simple by the tax code. Excite I saw The Who says we need something that's not more more complicated come on yeah. That's just. That that's just that's so easy and and seeping with out with reducing rates and saying. And saying things like you'll we're gonna we're gonna reduce the loopholes let's great but loopholes or tax advantages that the companies or individuals take advantage of because they're there so what persons look all is another's good tax benefit and that's why you pay lower taxes. Everyone can't pay less in taxes without taking a major hit out of the pot so once you get into the details and in clearly. The eat how they craft this around higher income earners people like president trump quite frankly. How it's crafted around them could be what sells or sinks this plant with regard to the public because the message from trump the trump campaign. The populist message that he talked to cut to counties around the country. Was I am going to help forgotten people people that are left behind like you it's not I'm gonna cut taxes for millionaires and billionaires if people understood what the estate tax was that by Paul little differently. From part for that reason because it's only hiring come people that are subject to it at all similarly a lot of the deductions that wealthier Americans take advantage of they may poll well but once you realize the -- else is different so how the stakeholders express themselves and what this plan looks like. If it's a true help the middle class populist inspired. Movement of of a tax package that's a different story than what we're seeing so far right now what we're seeing is a whole lot of ways to drain the treasury. And right now we're seeing to be fair is this one sheet of paper so I guess the big question is do we know enough about what this would look like how would affect people. I think if. Lancer is now we don't know it out but I think it's very telling I've been watching what's going on Wall Street right now and stocks are up but they're only up 35 points the Dow is up 35 points right now so. Wall Street which has been really cheering on investors cheering on this idea tax reform. Regulatory overhaul they're not cheering on this moment even though we now have this planet our hands. And Rick at the bottom of this one sheet of paper which is again all we have to go on right now but they do say that a listening tour coming right there going to be speaking to members. Congress and figuring out how to move people where it. Is there time and NO a lot of this is being pushed through to try to get within a hundred day mark. Is there a way that full legislation could somehow come about before Saturday. No my gosh. I've been told about six weeks and that's that's back of the envelope for them the president himself pushed the time line up on this quite a bit and wanted to get it on. At this and at its earliest agent and it is into the first one days at least show progress on it. But note they they're not even close to draft legislation the folks on the hill were bewildered by this bush. When it was announced by the president last week that he would have this announcement on Wednesday the people that are part of the tax writing in the budget committees in always talking about. They've gotten up to speed but only on these brought that's the bulls because just the most fundamental questions like who's gonna get impacted. What these brackets apply to what deductions are gone those are just basic questions the White House is not able to answer because they say there is an answer. We'll wait and watch for those details reclined down in Washington DC Rebecca Jarvis back here in New York Knicks haven't yet. And of course thanks all of you are watching as well you can always go to abcnews.com for more and stay with us your latest live if happening right now are not mom and about you back here real.
This transcript has been automatically generated and may not be 100% accurate.