President Trump on Wednesday unveiled the framework for his plans for tax reform, calling for the "largest tax cut in our country's history."
Trump said his plan would focus on cutting taxes for low-income and middle class Americans, not the wealthy.
He called for a major simplification of the individual income tax bracket system from seven tax rates to just three, 12%, 25% and 35%. Trump added that Congress will have the ability to apply a fourth tax bracket for the wealthiest Americans.
Trump also said his plan would increase the standard deduction rates.
"The first $12,000 of income earned by a single individual will be tax free. Married couple wont pay a dime on their first $24,000," he said.
"Our country and our economy cannot take off like they should unless we dramatically reform America’s outdated, complex and extremely burdensome tax code," Trump said.
Trump said the goal was for Americans to be able to file their taxes on a single sheet of paper.
Under his plan, the corporate tax rate would be cut from 35% to no more than 20%, which is substantially below the average corporate tax rate of other industrialized nations, Trump said.
Trump also said tax reform legislation would repeal many loopholes and special interest tax breaks and get rid of the alternative minimum tax.
"I'm doing the right thing, and it’s not good for me, believe me," Trump said.
Under Trump's plan, he said companies that have moved offshore to tax havens would be allowed to "bring the money home," and would face a one-time low tax on returning money that is already offshore "so that it can be brought back home to America where it belongs and where it belongs and where it can be put to work."
Trump did not specify how the tax cuts would be paid for but said Congress would spend the next few months working on legislation that would build on his framework.
Ryan Alexander, president of Taxpayers for Common Sense, a nonpartisan budget watchdog, said Trump's proposal "does not, in its current form, represent a framework for comprehensive tax reform."
Alexander said Trump's plan lacks details to determine whether or not the framework represents good policy.
"The last time the country achieved this goal, the White House and Congress undertook multiple comprehensive analyses, held dozens of public hearings, and worked in bipartisan groups. This nine-page framework is merely a start," Alexander said.
President Trump is expected to announce details of his much-anticipated plan to reform the federal tax code on Wednesday.
Trump will speak at a rally in Indiana and is expected to call on Congress to pass legislation that will cut taxes on corporations and the wealthy, and consolidate the current individual income tax bracket system.
Trump's plan reportedly will reduce the number of individual tax brackets from seven to just three, with rates of 12 percent, 25 percent, and 35 percent. That means some people who are currently in a lower tax bracket could end up paying more, depending on their income level, according to multiple news reports.
Some of the wealthiest Americans who are currently taxed at a rate of 39.6 percent could see their rate drop to 35, although Congress could opt to add a fourth tax rate for the wealthiest payers, The Hill reported.
There could be good news for low-income Americans, as Trump is expected to call for the current standard deduction rate to be nearly doubled to $12,000 for individuals and $24,000 for married couples. That means individuals who earn less than that amount could end up paying no federal taxes.
The plan would slash the corporate tax rate from 35 percent to 20 percent, which is slightly higher than the 15 percent rate Trump has been advocating.