The Trump administration has proposed substantial modifications to the U.S. tax code, spurring both controversy and support among diverse sectors of society and the economy. <\/p>\n
Partisanship debates aside, it has been argued that the new legislation could bring the largest tax cut for individuals seen since the Reagan administration. What we know at the time is that Trump has proposed: <\/p>\n
Working on the actual plan and its implementation, the Trump administration has been consulting with a variety of experts and interest groups. Notably among them has been the Hispanic 100 Policy Committee, a group created to develop and promote leadership within and from the Hispanic community. <\/p>\n
Readers might remember family office manager and Engineered Tax Services CEO Julio Gonzalez from his recent interviews with Benzinga, in which he discussed keeping jobs in the United States using tax engineering and the challenges of being a Latino money manager on Wall Street. <\/p>\n
After Hispanic 100 representatives met with government officials to discuss their concerns, Gonzalez was invited for several follow-ups with the administration, the Senate and Congress. Being a well-known tax reform expert, as well as a member of Hispanic 100, Julio is an advocate for fiscal responsibility and economic freedom, as well as a promoter for impacting the Hispanic population as it relates to the overall social and economic good, a press release read. <\/p>\n
So, Benzinga reached out to Gonzalez once again and asked him about the proposed tax reform and his role in its conception. <\/p>\n
In the United States, tax reform is under the charge of Congress. First, the Ways and Means Committee drafts the tax reform policy. On this occasion, Congressman Robert Brady and Speaker of the House Paul Ryan drafted a tax reform blueprint, which then has to get reviewed by the Trump administration and ultimately passed by the Senate, Gonzalez explained. <\/p>\n
Now, the tax reform that theyve drafted is difficult to get done, much like healthcare was difficult to get done here in the United States because, with tax reform youre taking money from one person and giving it to the other. And, with that people fight for whats being taken from them, he added. <\/p>\n
As a representative of Hispanic 100, Gonzalez assured the groups biggest concern is related to the unintended consequences that could derive from the tax reform as its currently drafted. <\/p>\n
Our big concern is that, currently under the blueprint, they want to eliminate interest deduction expensing and 1031s, and they want to have a border adjustment tax, he said. The administration is using those three things to get money into Treasury, to cut rates (ultimately) for the growth of GDP. <\/p>\n
However, these objectives are not easy to attain, he continued. For instance, the border tax adjustment, which would tax anything coming into the country, could provoke a reprisal from other nations. Its a great thought to think we can get all this money, but its difficult to believe that it just wouldnt be retaliated. <\/p>\n
It is also important not to miss the fact that these taxes will mean consumers will pay more for all imported goods. This does not help with getting the adjustment through, either. <\/p>\n
Gonzalez goes to D.C. weekly to talk to people in Congress, Senators and people in the Trump administration. Taking into account the limitations explained above, the tax expert consults on ways to get to a tax reform proposal thats achievable in the short term, focusing on things like why eliminating interest expense (carried interest in 1031) could create a glut in the real estate market, which some economists say accounts for 70 percent of GDP. <\/p>\n
So, while Ryan and Brady think things like eliminating interest expense will help grow GDP, Gonzalez, as a business and real estate owner, actually thinks the opposite. <\/p>\n
What I try to do in D.C. on a weekly basis is try to educate them on what are the unintended consequences that come from the tax reform ideas in the blueprint, he said. How can we modify them to get something done thats not going to have so much resistance and does help GDP? <\/p>\n
Finally, Benzinga asked Gonzalez about how he felt his suggestions were being received in D.C. <\/p>\n
I think Congressmen, Senators and their staffs are listening. I think that theyre very concerned and understand our points regarding unintended consequences of tax reforms, he responded. <\/p>\n
In a way, Gonzalez is not just representing the Hispanic community, but also every other minority group in the country, as well as small business owners. We all have the same concerns, he said. <\/p>\n
The ultimate collective goal is to spur GDP growth, Gonzalez concluded. However, the way to achieve this does not generate such a unanimous opinion. We have to see where that balance is ... What I predict, probably, would be a smaller reform that people can agree to getting done. I think, probably, the border adjustment tax will not get done, but ultimately well get some revenue into Treasury, to help cut tax rates and remain competitive. <\/p>\n
More From Benzinga: <\/p>\n
Alternative Paths To The Public Markets: Nexeon MedSystems' Form 10 IPO And Capital Consciousness <\/p>\n
What The Algeria-Morocco UN Drama Means For Regional Stability And The Fight Against Terrorism <\/p>\n
Posted-In: Futures Politics Top Stories Economics Exclusives Markets Interview General Best of Benzinga <\/p>\n
2017 Benzinga.com. Benzinga does not provide investment advice. All rights reserved. <\/p>\n
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Mr. Gonzalez Goes To Washington: Tax Engineer Explains Trump Admin's Proposed Tax Reform And How He's ... - Benzinga<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" The Trump administration has proposed substantial modifications to the U.S. tax code, spurring both controversy and support among diverse sectors of society and the economy. Continue reading