What is the Impact of Trump Tax Reforms on US Stocks?

Capping the amount of net interest expense on corporations penalises companies that use a lot of debt in their capital structure

Elizabeth Collins, CFA 28 September, 2017 | 9:23AM

Donald Trump is pushing through tax reforms

Morningstar analysts currently view the unified framework for tax reform released by the Trump administration, the House Committee on Ways and Means, and the Senate Committee on Finance on September 27 as a starting point for tax reform negotiation and that it’s not truly representative of what an eventual tax reform bill may look like.

This nine-page framework is similar to other guiding principle documents about tax reform, like the 35-page House Republican Better Way blueprint and the one-page outline from the White House. As a reminder, items in the previously released guidelines appear to have fallen by the wayside, such as the border adjustment tax in the blueprint and the 15% corporate tax rate in the White House outline, so we anticipate adjustments to this framework, especially as the details are filled in.

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About Author

Elizabeth Collins, CFA  is an associate director of equity research with Morningstar.

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