But President Donald Trump's treasury secretary doesn't see 3 percent economic growth coming in the immediate future.
Treasury Secretary Steven Mnuchin shakes hands with President Donald Trump on Feb. 13 in the White House. MANUEL BALCE CENETA/AP
Newly minted Treasury Secretary Steven Mnuchin is hoping comprehensive tax reform will be passed before August's congressional recess, but thinks a sustained surge in economic growth isn't likely to start in earnest until next year or later.
In his first interviews since being sworn in as President Donald Trump's Treasury head, Mnuchin this week laid out his future expectations and ongoing priorities as one of Trump's most significant economic point men.
During a discussion with The Wall Street Journal, he reiterated that he thinks the economy will be able to hit sustained annual economic growth of "3 percent or higher" under Trump, even though that hasn't happened in a single year since 2005. Mnuchin blamed that reality in part on policies from President Barack Obama's tenure that Trump and his team are working to reverse.
The key to getting there, Mnuchin said, lies in tax and regulatory reform. Trump's administration already has begun working on the latter through regulation-minded executive actions, and Mnuchin said the goal for the former is to have a substantive tax package passed by August.
But that could prove to be "an ambitious timeline," he said, noting that there's still plenty of work to be done with Congress and that the process "could slip to later in the year."
Republicans in Congress generally agree that tax reform should be a priority for the new administration, and the GOP tax plan circulating through the House is in many ways similar to the one championed by Trump during election season.
But the plans include notable differences related to exactly how much revenue the government would collect. Republican lawmakers and Trump agree corporate taxes should be lower, but Trump has at times called for a business tax rate lower than the one supported by Republicans.
The GOP plan, notably, also would launch border-adjustment taxes that would hit imports while cutting American exporters a break. Trump's administration previously has floated a border-adjustment tax as a way to pay for the president's proposed wall along the U.S.-Mexico border. But Trump also has advocated for levying high tariffs against specific countries – namely, China and Mexico – and it's not entirely clear whether such measures would be one-off policies or part of a a uniform import tax plan.
Despite Trump's promise to fight for tax reform within his first 100 days in office, Mnuchin in a separate interview with CNBC acknowledged the administration has yet to work out the finer details with lawmakers. Specifically, he said he and his colleagues are "looking closely on the issues of the border-adjusted tax.
"
"We're looking at it. We think there are some very interesting aspects of it. We think there are some concerns about it," he said.
Mnuchin also appeared to indicate the Trump administration isn't interested in simply delegating the tax reform process to Republican lawmakers, telling CNBC the administration and members of Congress are working on a "combined plan that is a plan that is the administration's plan," which he hopes would be supported by Republicans from the House and the Senate.
The new treasury secretary also said he believes the economy can hit a sustained growth rate of 3 percent under Trump, but that such a pace is likely out of reach until tax and regulatory changes can be enacted and have time to play out. When asked for a timeline, he speculated that it's "definitely going to take into next year to see an engine of growth."
Mnuchin also said it may "take a couple of years to get growth," depending on how the economy evolves and how many policy proposals the Trump administration manages to push through Capitol Hill.
"I think if you look at long-term growth, we have underperformed where we need to be," Mnuchin said, acknowledging that "it's going to take time to get there.
"
Mnuchin also was noncommittal on a question related to labeling China a currency manipulator – something Trump vowed to do on his first day in office while out on the campaign trail.
"We're not making any judgments until we continue that process," Mnuchin said, noting that the administration had no immediate plans to call China out for alleged currency manipulation.
