US Treasury chief nominee says tax reform top priority

By Ovunc Kutlu

NEW YORK

Tax reform is going to be the top priority for the new U.S. administration to achieve greater economic growth, President-elect Donald Trump's choice for Treasury Secretary Steven Mnuchin said Wednesday.

"We're going to cut corporate taxes, which will bring huge amounts of jobs back to the United States,” he said during an interview with CNBC.
“So, we'll think by cutting corporate taxes will create huge economic growth.”

Mnuchin, a former Wall Street executive, also noted that the Trump government will "have a big middle income tax cut" to increase personal income and stimulate personal spending to achieve growth.

Trump promised during his campaign to cut corporate taxes to 15 percent from 35 percent. He also said he would simplify America’s convoluted tax code, cutting the number of tax brackets from seven to three -- 12 percent, 25 percent and 33 percent.

He also promised to bring American companies overseas back to the U.S., and Mnuchin said the Trump administration "is going to have open communications with business leaders".

Mnuchin, who worked as the national finance chairman of Trump's campaign, said the new government's goal will be to achieve sustained economic growth -- around 3 to 4 percent of GDP per year.

Wilbur Ross, who will head the Department of Commerce, hinted in the interview that the Trump administration would make improvements in trade.

"We've been doing a lot of dumb trade," said the investor, who is widely known for restructuring failed companies.

"The real trick is going to be increase American exports. Get rid of some of the tariff and non-tariff barriers to American exports," he added.

For U.S. exports to increase, however, the value of the dollar needs to stay low. And, a possible rate hike by the Federal Reserve could hamper those efforts.

Ross said he thinks the Fed will increase its benchmark interest rate in December.

Mnuchin said he expects interest rates to stay "relatively low" for the next couple of years.