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O'Dowd backs Trump's one-page tax plan

TAX SUPPORT: Flynn MP Ken O'Dowd speaks at Gladstone's Australia Day ceremony earlier this year.
TAX SUPPORT: Flynn MP Ken O'Dowd speaks at Gladstone's Australia Day ceremony earlier this year. Paul Braven GLA300117KEN

FLYNN MP Ken O'Dowd has thrown his support behind US President Donald Trump's one-page tax plan.

The bullet-pointed document was released on Wednesday by Treasury Secretary Steven Mnuchin and National Economic Council director Gary Cohn after President Trump promised it would be released "Wednesday or shortly thereafter".

If implemented, the plan would see personal rates simplified to three income brackets of 10%, 25% and 35%, but it did not specify the incomes at which those rates would kick in.

Business rates would be slashed from 35% to 15%, while the estate tax - currently applied only to individual estates worth well more than US$5 million - would be eliminated.

 

SIMPLE: US President Donald Trump.
SIMPLE: US President Donald Trump. Susan Walsh

Bipartisan think tank Committee for a Responsible Federal Budget, whose members include a former budget director in the Reagan administration, criticised the plan.

The group estimated the plan would cost the US budget between $3 trillion and $7 trillion, depending on how the cuts are offset.

"With interest costs, a $5.5 trillion tax plan would be enough to increase debt to 111% of GDP by 2027," the group wrote.

"That would be higher than any time in US history, and no achievable amount of economic growth could finance it."

Mr O'Dowd nevertheless took to Facebook on Thursday to praise the ideas contained in the document, calling it "a bold plan to stimulate business investment in the US".

"(These are) the sort of reforms around the globe we have to compete with to remain viable for companies to invest here," he wrote.

The Coalition recently secured support in the Senate for moves to cut Australia's corporate tax rate from 30% to 27.5% for companies with a turnover of up to $50 million.

Mr O'Dowd's office was contacted for comment.

Topics:  donald trump ken o'dowd tax reform


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