Tag Archives: tax reform

Republicans see tax reform complicated by Trump deal with Democrats

FILE PHOTO: President Trump meets with Senate Majority Leader Mitch McConnell, Senate Democratic Leader Chuck Schumer, House Minority Leader Nancy Pelosi and other congressional leaders in the Oval Office of the White House. REUTERS/Kevin Lamarque

By David Morgan and Susan Cornwell

WASHINGTON (Reuters) – U.S. Republican party lawmakers warned on Friday that President Donald Trump’s legislative deal with Democrats to help hurricane victims and keep the government running for another three months could complicate his next big priority – tax reform.

Trump’s sudden shift in strategy hands a clear victory to Senate Democratic leader Chuck Schumer and House Democratic leader Nancy Pelosi and that could slow the Republicans’ legislative agenda, they said.

“This kind of creates complications relative to tax reform,” said Representative Ryan Costello from Pennsylvania. “It seems to me that there’s an element of unpredictability from one issue to the next and this week is sort of a reflection of that.”

“There was a lot of work going into how this was going to take shape in September. And that was entirely undermined … seemingly very spontaneously.”

Following Trump’s deal with Democratic leaders, the House of Representatives on Friday approved legislation that provides $15.25 billion in emergency disaster aid for the victims of Hurricane Harvey, which battered coastal areas of Texas and Louisiana last week, and Hurricane Irma, which is expected to pound Florida in coming days.

Already approved by the Senate on Thursday, the deal also raises the U.S. government’s debt ceiling and allows it to continue financing federal spending programs until Dec. 8, the new deadline for a deal on both issues.

But some Republicans fear the Democrats will be able to use their negotiating clout in early December to resist changes on key tax issues, especially the corporate tax rate, which Trump wants to cut from 35 percent to 15 percent.

Republican Senator Ben Sasse said the experience of watching Trump empower Democrats had been “embarrassing” for a Republican-controlled Congress and that the deal made Schumer “the most powerful man in America.”

Sasse was one of 17 Senate Republicans who voted against the deal on Thursday. In the House, all 90 “no” votes came from Republicans but the deal passed comfortably with 183 Democrats and 133 Republicans in favor.

The White House said Trump’s shift in strategy this week clears away complicated issues like the debt ceiling and government funding, both of which had to be resolved in September, so Congress can concentrate more fully on tax reform, which Republicans want to complete by the end of the year.

After the failure of Republican efforts to overturn former President Barack Obama’s Affordable Care Act in July, Trump and lawmakers need a legislative victory to shore up their hopes of maintaining Republican majorities in next year’s midterm elections.

FRUSTRATION

Some House Republicans are already frustrated by a lack of details on tax reform from the administration. They hope to see more as soon as next week, though some are skeptical.

“My expectations are low. I think if they had something big they’d be floating elements of it now,” said Representative Darrell Issa.

How House Republicans respond to the tax plan will help determine the challenges they may face passing a fiscal year 2018 budget resolution that is critical to the Republican strategy for tax reform.

The budget contains a procedural rule that would allow Republicans to enact tax legislation with a simple majority in the Senate, which they control by a 52-48 margin.

Republican aides said House leaders had expected to bring the budget to the floor next week, but the document now needs changes to include government revenue projections that take into account current tax policy and the failure to repeal Obamacare, aides say.

Members of the conservative House Freedom Caucus, a formidable bloc in the House, have said they will not support the budget until they see the tax reform plan and want the resolution to contain more cuts to federal spending than the $203 billion over a decade that it already contains.

It was not clear whether the budget resolution could now suffer from conservative anger over Friday’s vote. Many conservatives have long called for lawmakers to couple any measures that raise the U.S. debt ceiling with reforms to cut spending.

The deal that passed on Friday did the opposite by attaching an increase in the debt ceiling to more spending to keep the government open, as well as adding money for hurricane relief without making any spending cuts elsewhere.

“I love President Trump and I’m with him probably 90 or 95 percent of the time. But I don’t think it’s appropriate to raise the debt ceiling with a $19 trillion public debt and not have any effort to change the way we spend money here in Washington,” said Joe Barton, a House Freedom Caucus member.

Mark Meadows, who chairs the House Freedom Caucus, said he did not feel betrayed by Trump and that the legislation was a “unique situation” brought about by the massive storm damage in Texas and Louisiana.

“Because of hurricane relief, there wasn’t a whole lot of options,” Meadows said on MSNBC. But, he added: “Our grassroots are very confused.”

(Reporting by David Morgan and Susan Cornwell; Editing by Kieran Murray)

Trump to begin tax reform push next week, White House adviser tells FT

U.S. President Donald Trump speaks to the National Convention of the American Legion in Reno, Nevada, U.S., August 23, 2017. REUTERS/Joshua Roberts

WASHINGTON (Reuters) – U.S. President Donald Trump will begin a major push next week to convince the public of the need for tax reform, shifting his focus to fiscal policy in an effort to win a big legislative victory by the end of the year, The Financial Times reported on Friday.

Trump would begin the effort next Wednesday with a speech in Missouri, the first in a series of addresses to generate public support on the issue, Gary Cohn, director of the National Economic Council, told the newspaper.

“We are completely engaged in tax reform,” Cohn told the FT in an interview. “Starting next week the president’s agenda and calendar is going to revolve around tax reform. He will start being on the road making major addresses justifying the reasoning for tax reform.”

Although Cohn stressed that tax reform would be front and center of Trump’s agenda, the Republican-controlled Congress faces two other pressing issues when it returns from its August recess on Sept. 5.

Lawmakers need to approve an increase in the U.S. debt ceiling to allow the federal government to keep borrowing money and paying its bills, including its debt obliterations. Separately they need to pass at least stop-gap spending measures to keep the government operating. Deadlines on both issues will loom within weeks after lawmakers return from their break.

Asked by the FT whether the debate over the debt ceiling could derail the tax reform drive, Cohn said that “at the end of the day, Congress has to increase the debt ceiling – that is just the reality.” He added that this would be in September, before tax reform legislation.

“The key point is this: tax reform is the White House’s number one focus right now,” he added.

Cohn said White House officials had been working with Senate Majority Leader Mitch McConnell, House of Representatives Speaker Paul Ryan and other leading congressional Republicans on “an outline and skeleton” for the tax reform proposal, “and we have a good skeleton that we have agreed to.”

The details Cohn discussed were similar to those mentioned by Ryan at a meeting with Boeing employees on Thursday.

Asked whether the focus on tax reform had been complicated by Twitter attacks by the Republican president on McConnell and Ryan, Cohn said the White House officials worked well with the two “and we have made a massive amount of progress” on taxes.

Cohn said the House Ways and Means Committee would put more “flesh and bone” on the tax reform plan when lawmakers return from the recess. He said he believed a bill could pass tax committees in both chambers and be passed by both the House and Senate by the end of 2017.

TAX DETAILS

In the case of individual taxpayers, Cohn said the president’s reform plan would protect the three big deductions that people can claim on taxes: for home mortgages, charitable giving and retirement savings.

Beyond that, it would increase the caps for the standard deduction while eliminating most other personal deductions, Cohn said. The plan also aims to get rid of taxes on estates left when people die.

Cohn said for businesses, the administration is proposing to lower corporate tax rates, while eliminating many of the deductions that businesses use to reduce the amount of tax they must pay.

Asked whether the corporate tax rate could be cut to 15 percent as previously suggested by Trump, Cohn said, “I would like to get the tax rate as low as possible so that businesses want to create jobs here.”

He said the administration would propose going to a system where American companies would not have to pay additional tax when they bring profits earned overseas back to the United States.

“Today, they often have to pay extra taxes for bringing profits back to the U.S.,” Cohn said. “Our current system basically creates a penalty for headquartering in the U.S.”

He said the administration did envision a one-time low tax rate on all overseas profits.

(Reporting by David Alexander and Makini Brice; Editing by Jeffrey Benkoe and Frances Kerry)

Republicans on track for tax reform this year: lawmaker

FILE PHOTO: Chairman of the House Ways and Means Committee Kevin Brady (R-TX) listens to testimony before the committee on tax reform on Capitol Hill in Washington, U.S., May 23, 2017. REUTERS/Joshua Roberts

WASHINGTON (Reuters) – The head of the U.S. House Ways and Means Committee said on Tuesday Republicans are on track to pass tax reform this year and, unlike with healthcare, are united around a common plan even as the details are still being hammered out.

“We are on track to deliver transformational, bold tax reform this year,” Committee Chairman Kevin Brady told CNBC in an interview. “We have the White House, the House, the Senate working together on the same page unifying behind a single tax reform plan. That didn’t happen with healthcare.”

Brady, speaking ahead of a planned speech on the issue scheduled for Wednesday, said Republicans had yet to finalize tax rates and other details.

The White House has said it will release a tax reform framework next month but not accompanying legislation. That would instead come from a key group of legislators, who released their working framework in July.

The Republican Party controls both chambers of Congress as well as the White House, and President Donald Trump has been anxious to notch up a first legislative win. An effort to pass healthcare legislation failed last month.

“We’re still working with the White House and Senate on the details of this plan but we’re going to push rates as low as we can and we’re going to incentivize as much business investment now and in the future as we can,” Brady told CNBC, adding that any changes should be permanent “so that families and businesses can count on this.”

Asked about Trump’s handling of his party’s bid to repeal and replace Obamacare, which failed to gather enough votes to pass in the Senate, Brady said the president’s leadership would be key in pushing a tax plan.

“My sense … is he’s all in on tax reform,” he told CNBC.

(Reporting by Susan Heavey and Makini Brice; Editing by Frances Kerry)

Senate Democrats offer Republicans help on tax reform – with conditions

The United States Capitol is seen prior to an all night round of health care votes on Capitol Hill in Washington, U.S., July 27, 2017. REUTERS/Aaron P. Bernstein -The United States Capitol is seen prior to an all night round of health care votes on Capitol Hill in Washington, U.S., July 27, 2017. REUTERS/Aaron P. Bernstein -

By David Morgan

WASHINGTON (Reuters) – U.S. Senate Democrats offered to work with Republicans on a bipartisan tax reform package on Tuesday but only if it does not cut taxes for the wealthy, add to the federal deficit or allow Republicans to enact legislation on their own.

The conditional offer may not attract immediate response from Republicans. But it adds to growing signs of interest in bipartisan cooperation since the collapse of Republican healthcare legislation in the Senate last week.

In an Aug 1 letter to President Donald Trump and Republican leaders in the Senate, 45 lawmakers led by Senate Democratic leader Chuck Schumer said a bipartisan effort would raise wages for workers, grow jobs, promote investment and modernize the tax system for U.S. businesses.

“We are writing to express our interest in working with you on bipartisan tax reform,” said the letter, which then cited “prerequisites” for Democratic participation that Republicans would likely find hard to swallow.

Trump, along with Republicans in the Senate and House of Representatives, has called for major tax cuts for businesses and individuals, saying that lower tax rates would drive the economy and grow jobs.

Senator Orrin Hatch, Republican chairman of the tax-writing Senate Finance Committee, told Reuters on Monday that bipartisanship may be necessary to ensure that tax reform succeeds but blamed Democrats for slowing down the legislative process.

In Tuesday’s letter, Democrats said bipartisan tax reform should offer no relief for the wealthy, citing Treasury Secretary Steven Mnuchin’s assertion last November that there would be no absolute tax cut for the upper class.

“We hope you agree. Tax reform cannot be a cover story for delivering tax cuts to the wealthiest,” the Democrats said.

The Democrats also demanded that Republicans abandon their strategy of passing tax legislation in the Senate with a simple majority under a parliamentary procedure called reconciliation.

Republicans control the Senate by a slim 52-48 margin and say they need reconciliation to avoid a Democratic filibuster. They were unable to pass healthcare legislation last week, even with a simple majority.

Democrats also said they would not support deficit-financed tax cuts, which some Republicans view as a viable option.

Forty-three Senate Democrats and two independents signed the letter. Absent were the names of three Democrats facing reelection next year: Heidi Heitkamp of North Dakota, Joe Donnelly of Indiana and Joe Manchin of West Virginia.

(Reporting by David Morgan; Editing by Cynthia Osterman)

Washington refocuses on tax; anti-tax activist sees bill in September

Grover Norquist, president of Americans for Tax Reform, speaks before the dedication of a statue of the late Senator Barry Goldwater (R-AZ) in Statuary Hall on Capitol Hill in Washington February 11, 2015. REUTERS/Joshua Roberts

By Ginger Gibson and David Morgan

WASHINGTON (Reuters) – Congressional Republicans are ramping up discussions on overhauling the U.S. tax code that a prominent Republican anti-tax advocate said on Wednesday will produce a bill by September with a hefty corporate tax cut.

Grover Norquist, head of the anti-tax Americans for Tax Reform and a lobbyist close to Republican leaders, said a “Big Six” group of Republican tax decision-makers was targeting the end of this month for producing a basic framework for a bill to be introduced in September.

“The House, the White House and the Senate have been meeting for a couple months. They’ll have a package in September,” said Norquist, a conservative tax and small-government activist who has met with Big Six members.

The group met on Wednesday evening and two members who emerged 45 minutes later said they were united on tax principles but offered no comment on whether they had agreed to a framework.

“We’re all on one page, on one unified page,” White House economic adviser Gary Cohn said.

House of Representatives Ways and Means Committee Chairman Kevin Brady also told reporters there was unity and to expect a statement in coming days.

Central to the discussion is the 35 percent corporate income tax rate, how much it can be cut and whether a cut can be made permanent. The White House wants to slash the rate to 15 percent for seven years, while congressional Republicans are trying to settle on a permanent rate that does not increase the deficit.

President Donald Trump and his representatives on the Big Six – Cohn and Treasury Secretary Steven Mnuchin – are “really excited about the 15 percent rate” for corporations, Norquist said.

The congressional Big Six members are Brady, Senate Majority Leader Mitch McConnell, House Speaker Paul Ryan and Senate Finance Committee Chairman Orrin Hatch.

Norquist has played a key role in tax negotiations in Washington for years.

Trump is insisting on lowering the tax rate for pass-through businesses, now taxed at the top individual tax code rate, to 15 percent, Norquist said.

The Big Six agree that Trump’s 15 percent corporate rate cannot be achieved on a permanent basis without adding to the federal deficit, administration officials said.

Such a steep tax rate cut would mean a revenue loss of more than $2 trillion over a decade, independent analysts say.

To solve the deficit issue, the White House is open to making the 15 percent rate temporary, with an expiration in seven years, Norquist said. That would conflict with Republicans in Congress who want a permanent tax overhaul, but it would ensure rates would not have to be renewed during Trump’s presidency.

Mnuchin said on Wednesday morning that the administration would be “sensitive to increasing the debt.”

“We are very close to releasing a detailed plan and I can assure you that we believe that detailed plan will be responsible on the impact on the economy and the cost to the debt,” he said.

Under current law, companies adhere to complex depreciation schedules for how long it takes for equipment to wear out and lose value.

Business groups have called for “100 percent expensing,” a policy that would let companies write off the entire price of equipment in the year of purchase. Former President Barack Obama pushed for temporary 100 percent expensing as a economic stimulus to help reverse the recession when he took office.

The White House is considering a three-year window to allow 100 percent expensing, Norquist said. After the three years, the rate would return to 50 percent, which is the current law.

(Reporting by Ginger Gibson; Editing by Dan Grebler and Bill Trott)

House speaker optimistic on tax reform prospects this year

Speaker of the House Paul Ryan walks through National Statuary Hall after making a statement at the U.S. Capitol Building in Washington, U.S., June 14, 2017.

By David Morgan

WASHINGTON (Reuters) – The top Republican in the U.S. House of Representatives is expected to reassure business leaders on Tuesday that tax reform is on track for this year, despite repeated delays and a string of political distractions from President Donald Trump.

In what is billed as a major speech, House Speaker Paul Ryan will seek to dispel the notion that tax reform is adrift by describing what a U.S. tax code overhaul will look like, according to a source close to Ryan’s office.

The speaker will emphasize the importance of permanent reforms and reject the notion that legislation should do little more than reduce tax rates, the source said. He will underscore the need for international corporate tax reforms in remarks to the National Association of Manufacturers.

Aides said he is not expected to delve into the details of tax proposals.

The Wisconsin Republican delivered a similar optimistic message to lobbyists and campaign donors in Virginia over the weekend, adding that he expected Congress to finalize legislation to dismantle Obamacare by mid-summer, according to a source familiar with the Speaker’s comments.

Originally expected to unveil tax reform legislation in the spring, Republicans are under pressure from business lobbyists to make good on campaign pledges to reform the tax code and pass healthcare legislation.

Lawmakers also need legislative victories to stave off Democratic challenges in next year’s congressional mid-term elections.

“What Ryan needs to do is refocus folks on the rationale for having tax reform, not just the political rationale, but the economic rationale,” said Jeff Kupfer, a former economic adviser to President George W. Bush.

Markets have been anticipating lower taxes. Major stock indexes have hit multiple record highs from Trump’s election to the end of the first quarter, on bets he would improve economic growth by cutting taxes and boosting infrastructure spending.

The tax reform debate has largely moved behind closed doors, where Ryan is trying to hammer out an agreement with Senate Republican leader Mitch McConnell, Treasury Secretary Steven Mnuchin, White House economic adviser Gary Cohn and Republican chairmen of the two congressional tax committees. The aim is to unveil tax reform legislation in September.

Outside those discussions, lawmakers have begun to talk about legislation that would do little more than cut taxes, with temporary reductions financed by the federal deficit.

(Reporting by David Morgan; Editing by Chris Sanders and Jeffrey Benkoe)

With Obamacare vote, House Republicans free to turn to tax reform

U.S. President Donald Trump (C) celebrates with Congressional Republicans in the Rose Garden of the White House after the House of Representatives approved the American Healthcare Act, to repeal major parts of Obamacare and replace it with the Republican healthcare plan, in Washington, U.S., May 4, 2017. REUTERS/Carlos Barria

By David Morgan

WASHINGTON (Reuters) – The Republican-controlled U.S. House of Representatives plans to turn to tax reform in earnest, after concluding a lengthy healthcare debate this week with a vote to repeal and replace Obamacare.

But even as Republicans predicted that tax reform would succeed before year-end, lawmakers encountered new uncertainties about what a final tax package might contain, as well as doubts about whether Republicans will be able to enact reforms without Democratic help.

President Donald Trump and Republicans in Congress have pledged to complete the biggest tax reform since 1986, when President Ronald Reagan was in office, before the end of 2017. But they face an uphill battle, mainly over policy differences within their own ranks.

Thursday’s 217-213 House vote on healthcare legislation raised confidence in the Republican-controlled chamber’s ability to move major legislation after two earlier pushes ended in failure.

But to move forward on tax reform, the House, Senate and Trump administration must agree on where to set tax rates, how to pay for cuts and whether the final package should add to the deficit or pay for itself, all areas where common ground may be hard to find.

A plan to enact reforms without Democratic support will also require Republicans to pass a 2018 budget authorizing the parliamentary process known as reconciliation. But a new budget agreement poses a daunting task given Republican opposition to Trump demands for deep domestic spending cuts.

“That may prove to be one, if not the most difficult votes of the tax reform process,” Jonathan Traub, a managing principal at the consulting firm Deloitte Tax LLP.

Meanwhile, the need to reach agreement between the House, Senate and White House will likely delay introduction of a tax reform bill, which had been expected in early June.

But Republicans say it will ultimately make it easier to enact reforms before the end of the year.

The House Ways and Means Committee, which will unveil the initial tax bill, is still aiming for a revenue-neutral package that raises $2.4 trillion for tax cuts through a new border adjustment tax and elimination of business deductions for net interest payments, both controversial measures.

Panel chairman Kevin Brady told reporters that revenue neutrality is necessary to ensure bold, permanent changes to tax policy that can drive economic growth.

“That’s the argument and the case we’re going to make to the Senate and the Trump administration,” he said.

But Representative Mark Meadows, who chairs the conservative Freedom Caucus that helped block Trump’s first healthcare bill,

voiced opposition to a revenue neutral approach.

“If it’s revenue neutral, you’re not really lowering taxes. You’re shifting the burden,” Meadows told reporters.

The Trump tax plan unveiled last week calls for steep tax cuts financed by government revenues that officials say will result from higher growth. Some fear the plan could add trillions of dollars to the deficit if growth does not materialize.

Meadows said tax cuts should be offset by cuts to entitlement programs including Social Security and Medicare, which Trump has promised not to touch.

(Editing by Alistair Bell)

Trump tax plan slashing business rates to test support in Congress

President Trump waves as he boards Air Force One. REUTERS/Yuri Gripas

By Amanda Becker

WASHINGTON (Reuters) – U.S. President Donald Trump will release a tax plan on Wednesday proposing some deep rate cuts, mostly for businesses, including a slashed corporate income tax rate and steeply discounted tax rate for overseas corporate profits brought into the United States, officials said.

Trump intends for his broad blueprint, which will fall short of the kind of comprehensive tax reform that Republicans have long discussed, to be a guidepost for lawmakers in the U.S. House of Representatives and Senate.

“We’re driving this a little bit more,” a senior White House official told a group of reporters late on Tuesday.

The plan is not expected by analysts to include any proposals for raising new revenue, potentially adding billions of dollars to the federal deficit.

Treasury Secretary Steve Mnuchin has been leading the Trump administration’s effort to craft a tax package that can win support in Congress.

Though the U.S. House of Representatives and Senate are both controlled by the Republican Party, some aspects of Trump’s proposals could be a difficult sell, including to some fiscal hawks in his own party. Trump’s plan will cut the income tax rate paid by public corporations to 15 percent from 35 percent and sharply cut the top tax rate by pass-through businesses, including many small business partnerships and sole proprietorships, to 15 percent from 39.6 percent, an official said.

Trump will also propose a repatriation tax on offshore earnings along the lines of his campaign proposal for a 10 percent levy, versus the 35 percent due on repatriated foreign profits under present law, the official said.

Trump’s proposal will not include a controversial “border-adjustment” tax on imports that was in earlier proposals floated by House Republicans as a way to offset revenue losses resulting from tax cuts.

Mnuchin has said the cuts will pay for themselves by generating more economic growth, but fiscal hawks, potentially some in Trump’s own Republican Party, along with Democrats are certain to question these claims.

Whether Trump will include provisions that could attract Democratic votes, such as a proposal to fund infrastructure spending or a child-care tax credit as proposed by his daughter Ivanka, is still the subject of speculation.

The senior white house official said Trump would like to see Congress pass tax reform by the middle of autumn.

The last overhaul of the U.S. tax code was in 1986 during the administration of former President Ronald Reagan, a Republican.

(Additional reporting by Steve Holland; Editing by Simon Cameron-Moore)

U.S. House panel to begin hearings on tax reform next week

Chairman of the House Ways and Means Committee Kevin Brady (R-TX) speaks about a Republican healthcare amendment during a press briefing on Capitol Hill in Washington, U.S., April 6, 2017. REUTERS/Joshua Roberts

WASHINGTON (Reuters) – The tax-writing committee of the U.S. House of Representatives will begin holding hearings on a Republican tax reform proposal next week, the panel’s chairman said on Tuesday, even as the timeline for overhauling the tax code slips toward late 2017.

House Ways and Means Committee Chairman Kevin Brady told Fox News he would soon announce a hearing schedule to examine his House tax reform blueprint with its proposal to tax imports, a plan that appears to have lost ground as the White House works to unveil its own approach.

The investment consulting firm Veda Partners advised clients on Tuesday to expect an April 27 hearing on the import tax proposal known as the border adjustment tax, or BAT.

Brady’s committee could not confirm the date or topic, but he told Fox News the committee “will soon be announcing congressional hearings on our blueprint starting next week.”

He also acknowledged that the tax reform timeline could slip as House Republicans try to reach agreement to repeal and replace the Affordable Care Act, known as Obamacare, following their failed attempt to pass healthcare legislation in March.

Treasury Secretary Steven Mnuchin said this week that tax reform may not get done before an August deadline.

“We probably ought not be focused on the month but the year that it happens, which is this year,” Brady said. “If it moves a little past August and still lands in this year, it’s going to be an incredible achievement.”

Much of the debate has focused on the House Republican BAT proposal, which would impose a 20 percent tax on imports, while exempting exports from taxation. The proposal is opposed by import-dependent industries and Republicans who worry it could lead to higher consumer prices.

Tax experts say the proposal’s future depends on whether the White House backs it. President Donald Trump, who dislikes the term “border adjustment,” said on Tuesday his tax reform plan would create “a level playing field” for U.S. industry – a phrase widely viewed as referring to some kind of border tax.

Brady identified the critical elements of legislation as significant rate reduction, full and immediate expensing for capital investments and a simplified tax code.

He cautioned against straightforward rate reductions of the kind that some in Congress have begun to consider.

“A rate cut alone would have worked in the 1980s. It doesn’t in 2017 if we’re going to be competitive,” Brady said.

(Reporting by David Morgan; Editing by Chris Reese and Peter Cooney)

Trump to meet U.S. business leaders on infrastructure, tax reform

U.S. President Donald Trump waves as he walks from Marine One upon his return to the White House in Washington, U.S., April 9, 2017. REUTERS/Joshua Roberts - RTX34UUD

By David Shepardson

WASHINGTON (Reuters) – U.S. President Donald Trump will meet with about 20 chief executives on Tuesday as he works to gain support for a $1 trillion infrastructure program, tax reform and other administration priorities, said White House spokesman Sean Spicer.

Trump will meet with the heads of General Motors Co <GM.N>, International Business Machines Corp <IBM.N> and Wal-Mart Stores Inc <WMT.N>, a government official briefed on the matter said.

Trump has pledged to unlock $1 trillion in private and public infrastructure investments to fix bridges, improve the electrical grid and broadband internet, modernize airports and potentially rebuild hospitals for veterans. Nearly three months after his inauguration, Trump will again seek the advice and funds of the private sector for his “national rebuilding” program.

Trump also wants to streamline the income tax system, cut federal regulations, reduce corporate income tax and add new taxes to prod companies to keep or move production to the United States. He has held numerous sessions with CEOs since taking office.

The chief executives are part of Trump’s “Strategy and Policy Forum” that was created in December and last met with the president on Feb. 3.

The business leaders from a variety of sectors will also meet in small groups with Transportation Secretary Elaine Chao, Environmental Protection Agency chief Scott Pruitt, Commerce Secretary Wilbur Ross, Education Secretary Betsy DeVos and White House budget director Mick Mulvaney, Spicer said.

Participants in Ross’ meeting include Wal-Mart CEO Doug McMillon and Indra Nooyi, chief executive officer of PepsiCo Inc <PEP.N>. Pruitt’s meeting will include GM CEO Mary Barra and Paul Atkins, CEO of Patomak Global Partners LLC and a Republican former SEC commissioner. Chao’s meeting will include Tesla Inc <TSLA.O> CEO Elon Musk.

BlackRock CEO Larry Fink, who heads the world’s largest investment management firm, in a letter to shareholders Monday backed calls for private investment to rebuild U.S. infrastructure. The Trump administration plans to unveil as soon as May the $1 trillion infrastructure plan over 10 years.

“Fixing crumbling roads and bridges is not enough. We need to be focused on reshaping our world, not just repairing it,” Fink wrote.

Last week, Trump pitched infrastructure projects to about 50 New York area CEOs. National Economic Council Director Gary Cohn told executives that privatizing air traffic control, which the administration proposed in its budget outline in March, could be a big boost.

Other chief executives taking part Tuesday include consultant EY, Boston Consulting Group, the Cleveland Clinic and Global Infrastructure Partners, an infrastructure investment fund.

(Reporting by David Shepardson; Editing by Andrew Hay and Lisa Shumaker)