Before the end of January, President Trump issued an executive order that “for every one new regulation issued, at least two prior regulations be identified for elimination” and called for “the cost of planned regulations [to] be prudently managed and controlled through a budgeting process.”
By the beginning of February, President Trump had signaled that a “phenomenal” tax-cut plan was imminent.
The Republican-controlled Congress also was examining quick tax relief. CEOs realize that actually getting tax reform through Congress may take the Trump administration several months, but they demonstrate more impatience for the president to be forceful on this issue than on any other.
“It’s important he do that, because tax reform is the No. 1 imperative from a business perspective,” said Don Fox, CEO of Firehouse Subs, a quick-serve restaurant chain. “And the sooner the better. Relief for business on the tax side will create a better environment for reinvestment and growth, especially with all the other pressures we’re under. Lower taxes for individuals, too: it would bolster consumer confidence if people know relief is coming in their bank accounts.”
Tax cuts need to include all classes of businesses, including limited-liability corporations, not just big companies, the mid-market chiefs said. But some CEOs particularly welcomed the possibility that President Trump might cut corporate taxes from their 35% nominal rate in the U.S., perhaps partially in exchange for companies repatriating cash and untaxed profits held overseas—an amount that’s estimated to total $1 trillion or more.
“We need to bring offshore capital back,” said Harley Lippman, CEO of Genesis10, a tech-staffing outfit. “He can create a win-win situation, just as he writes about in his book,” The Art of the Deal.“Of course there will be some quid pro quo if he cuts rates to 20 or even 10 percent. Maybe it will involve companies investing in U.S. infrastructure, either themselves or through some fund that is set up to do it.
“This is a case of one and one equaling three,” Lippman adds. “And it could be a great legacy for President Trump if he could hit a real home run here.”
The mid-market chiefs believe that the order on regulations already represents a home run for a president who’d just come up to bat. “It was the most encouraging thing he’s done early on,” said Paul Kusserow, CEO of Amedisys, which delivers home-health and hospice care. In his industry over the previous eight years, “there was excessive regulation to the point of creating enormous burdens, intense labyrinths that didn’t allow us to take better care of our patients. We’re very encouraged if the cuts in regulations do occur.”
Eric Casaburi said that slashing regulations is important “so that we can finally see relief from the pain. Reducing the regulatory burden doesn’t mean we’re going to have another 2008” and a financial bailout, insisted the CEO of Retro Fitness, a chain of gyms. “It just means that we’re going to be a little less restrictive. We’re not going to make it
impossible for companies and business owners to succeed, because until now they’ve made it so hard.”