Did Donald Trump get tax tips from Sam Brownback?

Is Donald Trump getting his tax ideas from Gov. Sam Brownback?

Matt Gardner, the executive director of the Institute on Taxation and Economic Policy, sees some similarities between Trump’s tax proposals unveiled this week and the tax changes Brownback ushered into law during his first term in office.

Gardner scrutinized Trump’s tax plan in a post on the liberal-leaning think tank’s Tax Justice Blog Wednesday, scrutinizing Trump’s claims that he would raise taxes on hedge-fund managers, who Trump has said on the campaign trail are “getting away with murder.”

Gardner pointed out that while Trump’s plan would eliminate a loophole for private investment funds, his plan would also give hedge-fund managers an “even larger tax break … by creating a new, low 15 percent tax rate for pass-through business income.”

“Pass-through business income” refers to the money that owners of certain companies, such as sole proprietorships and limited liability companies, report on their personal income tax forms.

“The most likely consequence of having a special low 15 percent tax rate on pass-through income is that wealthy Americans, including money managers, will find ways to disguise their salaries as pass-through business income to take advantage of the low rate,” Gardner argued.

Gardner saw similarities between Trump’s plan and the policies that Brownback championed in Kansas. Of course Brownback’s tax plan went further than the real estate magnate’s and zeroed out pass-through income completely.

“Cutting the tax rate on pass-through income was a centerpiece of Kansas Gov. Sam Brownback’s supply-side tax-cutting experiment several years ago,” Gardner said. “Brownback claimed that a special zero-percent tax rate on pass-through businesses would result in a wave of job creation – and, as is now widely recognized, no such wave ever occurred and the provision helped devastate the state’s revenue.”

In the most recent legislative session some Republican lawmakers unsuccessfully sought to roll back this zero tax rate for business owners – most notably two Wichitans, Senate President Susan Wagle and Rep. Mark Hutton – in the face of a massive budget shortfall.

But the governor threatened to veto any tax plan that rolled back the policy and a bill crafted by Hutton, which would have done so, failed to pass the House of Representatives.

The governor’s office did not respond Wednesday when asked if there was a similarity between Trump’s plan and the governor’s policies.

Trump is not the only Republican candidate for president to pursue a low tax rate for pass-through business entities. Ohio Gov. John Kasich has also championed similar policies, signing into law this year a 100 percent income tax deduction for a business’ first $250,000 in revenue.

This story was originally published September 30, 2015 at 5:38 PM with the headline "Did Donald Trump get tax tips from Sam Brownback?."