(Bloomberg) -- Larry Fink, chief executive officer of BlackRock Inc., said that the tax plan released by President Donald Trump and Republican leaders will greatly expand deficits if it's not amended.
Fink said it would be harmful to eliminate the state and local tax deduction and that the plan won't likely pass with this provision in it. "If we stretch these states economically through the elimination of deductibility and people move, it creates bad behaviors in our own country," Fink said in an interview Tuesday with Bloomberg TV's Erik Schatzker.
Warren Buffett told CNBC on Tuesday that he's following tax proposals in Congress and may be compelled to buy or sell shares based on where the legislation ends up.
Also Read | Layoffs Are Rising In Tech, But These Skills Are Helping People Unlock Better Pay
“We have lots of stocks with lots of gains and we have a few stocks with losses,” he said. “I would feel kind of silly if I realized $1 billion worth of gains and paid $350 million of tax on it if I just waited a few months and would have paid $250 million.”
Trump's tax plan has been criticized for potentially ballooning the deficit. Senator Bob Corker, a Tennessee Republican, said Monday he wouldn't support a proposal that adds a penny to the deficit. Eliminating the state and local deduction faces opposition from Republican lawmakers in high-tax states like New York and New Jersey. Twenty-one of 26 economists surveyed by Bloomberg News predicted the plan will widen the budget gap over the next 10 years.
The CEO said he would support cutting the corporate tax rate to between 25 percent and 27 percent, noting that BlackRock pays a 31 percent rate worldwide. Trump's proposal calls for a 20 percent rate.
Fink said he supports some parts of the plan, including the 25 percent rate on pass-through businesses, since that would help small companies.
“We need to make sure we are fair and just across all sectors,” he said.
--With assistance from Erik Schatzker
To contact the reporter on this story: Sabrina Willmer in Boston at swillmer2@bloomberg.net.
To contact the editors responsible for this story: Margaret Collins at mcollins45@bloomberg.net, Vincent Bielski
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.
