Washington, Nov 1 Going as per the election strategy to announce sops for middle class during the 2020 presidential campaign, White House officials and congressional Republicans have begun talks on a new package of tax reductions and economic growth measures amid US economic slowdown.
White House National Economic Council Director Larry Kudlow is the lead brain in the talks, but the discussions on Thursday were on preliminary stage.
Both Treasury Secretary Steven Mnuchin and White House economic adviser Larry Kudlow hinted that President Trump wanted to pass “tax cuts 2.0” before the 2020 election. Trump also said publicly in September that there would be income tax cuts for the middle-class next year, the Hill reported.
“We are having those discussions with the White House, we’ll be engaging with them further, and we’ll have discussions with Republicans, too, in the House about what we think the most pro-growth elements can be the most pro-innovation,” Kevin Brady, a top Republican on the House Ways and Means Committee, was quoted as saying.
President Donald Trump is contemplating for an economic narrative that can be used in the elections as the major tax cut package of 2017 backed by congressional Republicans “failed to produce enduring economic benefits or political gains” for Republicans.
The Commerce Department announced on Wednesday that the US economy expanded at an annual rate of 1.9 per cent in the third quarter of the year, slightly lower than the 2 per cent growth rate in the second quarter. But Trump had states to grow US economy at 3 per cent per year.
The Federal Reserve lowered interested rates for the third time this year, in hopes of stimulating a dragging economy. Additionally, business investment has contracted for six straight months.
Non-residential fixed investment, a measure of corporate spending on structures and equipment, fell at an annual rate of 3 per cent in the third quarter, following a contraction of 1 per cent in the previous quarter.
The latest figures confirmed that Washington’s tariffs against other trading partners continued to take a toll on American businesses and the overall economy.
Political uncertainty also weighing on the economy
The US House of Representatives voted on Thursday to approve a resolution designed to formalize proceedings of the impeachment inquiry into Trump.
The resolution, unveiled earlier this week by the House Rules Committee, establishes procedures for public impeachment hearings and the release of deposition transcripts, and outlines the House Judiciary Committee’s role in considering potential articles of impeachment.
The Federal Open Market Committee, the Fed’s rate-setting body, trimmed the target for the federal funds rate to a range of 1.5 per cent to 1.75 per cent after concluding its two-day policy meeting, largely in line with market expectation.