Skip to comments.Dow drops 120 points as Senate plan would delay tax cut until 2019
Posted on 11/09/2017 12:56:15 PM PST by SeekAndFind
U.S. equities fell sharply on Thursday, pulling back from record highs, on worries that tax reform could be delayed until 2019.
A proposed plan by Senate Republicans would push tax reform back to 2019, CNBC has learned through a source. The move contrasts with a bill working its way through the House. The Washington Post first reported the news.
"That's what gave us this new leg down," said Art Cashin, director of floor operations at UBS, on CNBC's "Squawk Alley."
Expectations for tax reform have increased recently, helping lift the stock market to all-time highs. The major indexes had recovered some losses from earlier in the session prior to the Senate news breaking.
At 2:11 p.m. in New York, the Dow Jones industrial average traded 129 points lower, with McDonald's as the biggest decliner; it fell 1.8 percent. The Dow briefly fell more than 250 points.
The S&P 500 pulled back 0.55 percent, with industrials as the leading decliner; the sector fell 1.3 percent.
The Nasdaq composite lagged, falling 0.8 percent.
(Excerpt) Read more at cnbc.com ...
Confirming reports from earlier this week that the Senate GOP tax plan would delay the corporate tax cut for (at least) one year, a move that would strip the proposed tax reform of its most potent benefit, moments ago the Wapo reported that in a few hours, Senate Republicans will propose delaying a cut in the corporate tax rate from 35 percent to 20 percent until 2019. Bloomberg confirmed the news, quoting Bill Cassidy who said in an interview that that Senate Finance Committee tax legislation proposal will include a one-year delay before cutting the corporate tax rate to 20%.
The compromise would be a major departure from President Trumps insistence on immediate changes that he says "are necessary to spur the economy." And while some Senate Republicans objected to the one year delay, they were overruled.
As Bloomberg adds, the Senate tax writers will also propose keeping number of individual income-tax brackets at seven in a departure from the House bill that condenses the number to four, Sen. Bill Cassidy tells reporters. Cassidy also says Senate proposal wont keep top rate at 39.6%, though doesnt state what new top individual rate would be
In an attempt to offset the delayed economic boost from excess corporate spending, the WaPo explains that to prevent companies from waiting until 2019 to invest, "Senate Republicans will propose to allow companies to immediately deduct all capital investments in 2018 to incentivize them to spend more money immediately, the people said."
The reason for the delay is simple: there is not enough revenue. "The one-year delay would lower the cost of the tax cut bill by more than $100 billion, and negotiators are trying to preserve as much revenue as they can for other changes." The revision could also delay decisions by companies to move back to the United States from overseas or have companies hold off on other decisions as they wait for the corporate rate to fall.
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All part of the Dem/RINO Plan
They know POTUS has been talking up the Dow AND they love obstructing his agenda, at EVERY opportunity.
Color me shocked.
A blip on the screen.
This market is SO overbought it isn’t funny. Another thousand or so points would be healthy.
Ultra low interest rates and decent earnings will keep the bull running.
The Deep State republicans are dumbasses and will suffer the consequences of their treacherous actions.
Did they intentionally wait until President Trump was out of country to do this?
We are going to lose the House and the Senate next election because of their War on Trump. Unbelievable.
These bastards think they can blame Trump. Well they can’t and there needs to be a way that the voters can recall them for their lies.
Would a sell off help the economy? If not now, will there be one when us retirees get the numbers for what has to be taken out of the 401K for 2018?
The GOPe is gonna give us President Kamala Harris in 2020 at the rate they’re going.
Senate Republicans will propose delaying a cut in the corporate tax rate from 35 percent to 20 percent until 2019.
They're all Democrats.
Trump can run against both parties in 2020.
AFTER Trump's version of the tax plan is voted into law, THEN HE SHOULD PERSONALLY APPOINT a special prosecutor in the Deep State's Uranium One crime.
Are these morons out of their minds? The Republican senator. Stealing defeat from the jaws of victory once again.
Reduce spending reduce spending on the reduce spending
Can the President still appoint a Special Prosecutor? Or, does it now fall directly upon the (ZzzzZZZzzz) AG to appoint?
This article makes it sound like AG has to appoint....
I would LOVE to see POTUS appoint a SP on the Deep State....U1 and ALL offenses!!
Simple. Keep the tax cut and take a collective $100 billion out of HUD, Dept of Ed, Commerce, Energy, Interior, State Dep and Congressional budget.
Great going McConnell, Ryan and company.
You two turds and your cronies figure you have safe seats so aren’t worried about 2018.
As a matter of fact, you would probably prefer to have the Democrats in charge so you don’t have to make any decisions at all. No decisions, no aggravation, no blame.
As a matter of fact, you probably want Trump out of office. His “drain the swamp program” endangers all those cushy arrangements you have with those special interest groups to benefit them and screw the rest of America.
So you probably don’t give a damn about the stock market, individual Americans, or the overall economy as long as you can continue to milk the system.
But you may very well find yourselves BANNONIZED in the next election.
Republicans don’t like being the party in control.
If they don’t pass the tax cuts to take effect in2018, corporate and individual, I will be staying home on election day next year. I won’t be voting for democrats, but I will also not be voting for republicans.
Enough is enough!
The Deep State plans to take out Trump by
sabotaging the economy.
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