MNI: US Sr Treasury Official: Making Big Effort On Tax Reform

--Tsy Official: IMF Should Not Inject Itself Into US Tax Debate

By Kevin Kastner

     WASHINGTON (MNI) - The Trump administration has been making a "big effort"

on tax reform, a senior US Treasury official told reporters Wednesday in advance

of the annual meeting of the International Monetary Fund and World Bank.

     The official was responding to the downgrade to economic growth that the

international agencies gave to the US based on concerns that promised fiscal

stimulus will be not be accomplished.

     In the World Economic Outlook released Tuesday, the IMF downgraded US

economic growth to +2.2% in 2017 and +2.3% in 2018 from the +2.3% and +2.5%,

respective, forecasts in April. The WEO attributed some of that downgrade to a

less favorable view of fiscal policy stimulus, noting that "given the

significant policy uncertainty, the forecast now uses a baseline assumption of

unchanged policies, whereas in April it assumed a fiscal stimulus driven by

then-anticipated tax cuts."

     The Treasury official said that tax reforms is a "work in progress" and

suggested that the IMF should focus on its main purpose and not inject itself

into the tax debate in the US. The official said that lower tax rates would lead

to more jobs, and as a result in higher median income.

     The official said that there will be numerous meetings this week at the

IMF, including as many as 16 bilateral meetings attend by Treasury Secretary

Steven Mnuchin, that are meant to develop international relationships, with some

meetings focused on global security and cybersecurity. There will also be a

focus on regulatory reform and a meeting on Friday to discuss disaster relief. 

     Another topic to be discussed this week will be trade relations. The

official said that the Trump administration is "very involved" in cooperation

among countries, but the official was less enthusiastic about NAFTA, saying it

was "an old agreement" and that the world had changed since it was implemented

over 23 years ago. 

     The official declined to comment on the current efforts by Catalonia to

break off from Spain, but said that discussions should be focused on what is

best for all parties involved.

--MNI Washington Bureau; tel: +1 202-371-2121; email: kevin.kastner@marketnews.com

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