The specifics of Donald Trump’s tax plans remain elusive after the president delivered a milestone speech that coupled his usual tough talk on trade and immigration with a plea for bipartisan support.
In what could be an acknowledgement of the challenges he’ll face getting policies through both houses, the president called on all lawmakers to honor the will of the people that elected him. Trump already is having difficulty finding consensus among Republican lawmakers about how to repeal the Affordable Care Act.
He even appeared to offer some concessions on issues such as childcare and the environment to bridge relations with Democrats. “My administration wants to work with members in both parties to make childcare accessible and affordable, to help ensure parents have paid family leave, to invest in women’s health, and to promote clean air and clear water, and to rebuild our military and our infrastructure,” he said.
For the most part, though, the speech labored on ideas that appealed to Trump’s base: protectionist economic policies and hardened national security measures. Here are some key takeaways for business.
1. Tax and trade policy. Trump reiterated that he wants to cut taxes for households and companies, without mentioning the level of cuts or how they’ll be funded. In an earlier speech, the president said he would release details of a “phenomenal tax plan” possibly within two or three weeks, so it’s unclear whether that announcement is still imminent.
“My economic team is developing historic tax reform that will reduce the tax rate on our companies so they can thrive anywhere and with anyone,” Trump told Congress. “At the same time, we will provide massive tax relief for the middle class.”
He also alluded to trade taxes, an issue that has split the CEO community between exporters and importers. “Currently, when we ship products out of America, many other countries make us pay very high tariffs and taxes—but when foreign companies ship their products into America, we charge them almost nothing,” Trump said.
The president went on to detail a meeting he had with officials and workers at Harley-Davidson, who told him their motorcycles faced import taxes in other countries as high as 100%. “I believe strongly in free trade, but it also has to be fair trade,” Trump said.
The Harley-Davidson example could allude to Trump’s earlier mention of imposing a “reciprocal tax” on countries that charge high import tariffs.
2. Immigration and national security. Tech sector CEOs critical of Trump’s plans to curb immigration were given little cause to celebrate. The president reiterated that the White House was working on “improved vetting procedures” following a successful legal challenge to its controversial travel ban.
There was, however, an indication that Trump could soften his stance on the deportation of undocumented Mexican immigrants. He mentioned the possible introduction of a point system, whereby people could earn the right to residency by accumulating educational and vocational training.
“Switching away from this current system of lower-skilled immigration, and instead adopting a merit-based system, will have many benefits: it will save countless dollars, raise workers’ wages and help struggling families—including immigrant families—enter the middle class,” he said.
Several publications, including the New York Times, reported that Trump had told news anchors before his speech that he could be open to granting legal status to millions of undocumented immigrants who have not committed crimes.
During the speech though, Trump continued to talk bullishly about his plans for a border wall. “It will be started ahead of schedule and, when finished, it will be a very effective weapon against drugs and crime,” he said.
3. Regulations. Although the president appeared open to offer some concessions on environmental regulations, he certainty didn’t give the impression he’d become an overnight environmentalist.
Trump noted that the administration had already cleared the way for the controversial Keystone and Dakota Access oil pipelines and started rolling back regulations affecting the coal industry.
Earlier this month, he signed a measure that terminates Obama administration rules that stopped coal miners from depositing debris in nearby waterways.
Drug company CEOs would have been kept on edge, though, by the president’s pledge to “work to bring down the artificially high price of drugs and bring them down immediately.” He also promised to speed up the regulatory approval process for new drugs, though this could present challenges for companies that rely on rigorous approval processes to obtain insurance coverage for new medicines.
The president also reiterated his plan to impose a new rule that would kill two regulations for every new one created. He already has established a deregulation task force to weed out overbearing rules.
4. Infrastructure investment. Congress also will be given the tricky task of deciding whether to approve “$1 trillion” of spending on national infrastructure, though Trump said new roads, bridges, tunnels, airports and railways “gleaming across our beautiful land” would be financed through public and private capital.
He claimed that America had spent $6 trillion in the Middle East while its own infrastructure was crumbling. “With $6 trillion we could have rebuilt our country twice and maybe even three times if we had people who had the ability to negotiate,” he said.
The president also reiterated his pledge to invest more heavily in the military, though he reminded his audience that he’d put the screws on government contractors, such as Lockheed Martin, to lower the cost of their products.
“We’ve saved taxpayers hundreds of millions of dollars by bringing down the price of the fantastic new F-35 jet fighter, and will be saving billions more dollars on contracts all across our government,” he said.