Donald Trump says he's weighing cuts in payroll taxes, capital gains but dismisses recession fears
WASHINGTON – President Donald Trump said Tuesday his administration is looking at a temporary reduction in payroll taxes and other proposals to lift the economy but he dismissed warnings from private economists about the threat of a U.S. recession.
Trump said he had been thinking about reduction payroll taxes “for a long time” and said he was also interested in a possible reduction in capital gains taxes. He also called again for the Federal Reserve to lower interest rates.
“If the Fed would do its job, we’d have a tremendous spurt of growth,” Trump told reporters in the Oval Office during a meeting with Romanian President Klaus Iohannis.
Private economists are warning there are signs of a possible recession on the horizon, pointing to trade tensions between the U.S. and China and yields on 10-year Treasury bonds that dipped below two-year Treasury rates last Wednesday, a phenomenon known as an inverted yield curve. It's the first time that has happened since 2007 and could indicate investors have lost faith in the soundness of the U.S. economy.
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Trump has insisted the economy remains strong, but senior White House officials already have started preparing a contingency plan, including a temporary payroll tax cut, to put more money in workers' paychecks and boost growth.
Trump said he believes the U.S. economy is "very far from a recession" even as he conceded that his administration is looking for ways to increase growth.
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Trump said the White House is looking at "various tax deductions," including indexing capital gains taxes to inflation and temporarily cutting payroll taxes. But he stressed that it could take a while before any tax-cut package is unveiled.
"I'm not talking about doing anything at this moment," he said.
Trump said "a lot of people" would like to see a payroll tax cut, which he said "very much affects the workers of our country."
"Whether or not we do it now or not, it's not being done because of a recession," he said.
This article originally appeared on USA TODAY: Donald Trump weighing payroll tax cuts, other steps on economy
