>> announcer: this is "nightly business report" with tyler ma under the trump plan, we will have a massive tax cut for businesses and massive tax reform and simplification. >> what's in it, what's not. and what might the president's tax proposal mean for you, the taxpayer, and investors. stocks have been rallying on the prospect of tax reform. so why did they barely budge today? moving closer. days before the deadline, is progress being made to avert a government shutdown? those stories and more on shows sho "nightly business report" for wednesday, april 26th.

what a day it's been. good evening, everyone. the trump administration this afternoon unveiled its tax outline, a cornerstone of the president's economic agenda. and at the center of the blueprint is an overhaul to the individual tax system and a very sharp reduction in the tax rates paid by businesses large and small. >> as the president said during the campaign, we will lower the business rate to 15%. we will make it a territorial system. we will have a one-time tax on overseas profits which will bring back trillions of dollars that are offshore to be invested here in the united states to purchase capital and to create jobs. >> here now, more details, such as we know them. for individuals, the current seven tax brackets would be used to three, with a top tax rate of

35%, down from the current 39.6%. the other brackets, 25 and 10%. the standard deduction would be doubled to $24,000 for joint filing couples. the new plan would eliminate the federal deduction for state and local taxes. this is a big one. and the corporate tax rate would drop to 15% from 35%. u.s. companies would owe little or no tax on their future foreign profits. that's that territoriality that mnuchin was talking about. >> john harwood has been following the story from washington. good to see you, john. broadly speaking, who wins, who loses under this proposal? >> reporter: you're right, sue, because a lot of details are absent, it's hard to make comprehensive calculations. a couple of things we can say. high income individuals will be

big winners. they'll get a reduction in that are rate from 39.6 to 35%, if this passes. they'll get rid of the alternative minimum tax. they'll have capital gains and dividend taxes lowered to 20%. they're going to get rid of the estate tax. when you talk about losers, tyler mentioned it a few minutes ago, that is the loss of the state and local tax deduction, would hit hard for high tax, high income states like california, new york, new jersey. those happen to be disproportionately represented by democrats. >> so what happens now, john? what has the reaction been on capitol hill? where do we go from here? >> reporter: the reaction was a little underwhelmed, because this broadly resembles the plan that donald trump unveiled during his campaign. had this been markedly different, i think you would have had the table turned over the tax discussion. this allows the house ways and means committee, which has been preparing legislation which isn't terribly different in most

respects from the trump plan, they're planning to do action on a somewhat slower timetable they talked about earlier. once they said, we'll get it through by august. now they're saying by the end of the year. and we're waiting for the house ways and means committee to schedule those first hearings. >> what are some of the other obstacles, obviously getting it all passed is one of them. what are the others? >> reporter: the big obstacles politically, sue, are on the right you're going to have big concerns about the impact on the debt and deficit. the committee for responsible federal budget came out with a back of the envelope estimate this afternoon saying this plan over ten years would add $5.5 trillion to deficits and debt. that is going to be a problem for conservatives. on the left, you're already hearing reaction from the leadership by democrats in the house and senate that this is a giveaway to rich people and they're going to resist it. and it's also true that if you poll the issue of lowering

business taxes, that isn't all that popular. many of those blue collar, working class trump voters may be exposed to a lot of messaging from democrats who are going to say, hey, your president is going to cut taxes for wall street and big business, not for you. >> john, thank you very much. john harwood in washington. under president trump's proposed tax plan, if there are changes to your taxes, which deductions would stay, which could go? and how might it impact you? bill smith is managing director to share his perspectives on this. bill, i guess obviously the big chang in deductioan in deductio mnuchin said the mortgage tax deduction and for charters, those deductions stay, all others go away. >> that's absolutely right, tyler.

your mortgage interest deduction will stay and your charitable deductions will stay. everything else is gone. that means some big differences for a lot of filers. >> such as? one of the things that kind of stuck out to me was the medical expenses. on the other hand, there are some people where some of that is covered by employers, maybe that's not as significant as i think. >> i think it won't be that big a significant change, because it's difficult to find advantage of a medical deduction, because you only are allowed a deduction for amounts in excess of 10% of your gross income, your adjusted gross income. it's difficult without some relatively high medical expenses to get a benefit there. the really big one, the big uge one by far, as was mentioned, the state income tax deduction. >> that hits, as john pointed out, people in high tax, high income states like california, new york, new jersey, where real estate taxes are very high.

you would have to expect that those congressional delegations will put up a fight over it. >> he would certainly think so. if you lose your state income tax deduction and your real property tax deduction, that makes up a very large part of the typical schedule a where people itemize deductions. >> what do you think about the aspect of economic growth and paying for it? i mean, there are a lot of things in this plan that, as john just mentioned, people are worried will balloon the deficit and it will be difficult to pay for it. as you look at what's staying, what's going, what do you think? >> well, history would teach us that changes in tax policy don't move the economy that much. of course the republicans and the president want to adopt this "a rising tide raises all boats," and that a boon to the

economy will be good in itself. >> what do i need to know about depositing money into an ira or similar account or that i'm paying for 401(k)s with pretax income? last but not least, what about those adjustments to income like the effective deductibility of alimony payments for the payer? >> well, alimony is an excellent question. that wasn't addressed. we did hear from secretary mnuchin today that retirement plan tax benefits would be kept. presumably the ira deduction would be kept. your 401(k)'s would be safe. it's not clear about alimony, we have to wait and see as they flesh the plan out and give us a little more detail, who is going to get hurt and who will get saved. >> bill, we'll find out more in the coming days, i'm sure, bill smith. >> thanks, tyler. thanks, sue. as reported, the white house

has proposed slashing not only taxes for big companies but firms of all sizes. kate rogers tell us why that's a big deal. >> reporter: president trump's tax proposal includes a key element for small businesses across the country. parity with their corporate counterparts. the major tax cut the white house is proposing of 15% would apply to both big corporations and smaller businesses. according to the tax foundation, the vast majority of businesses in america are structured as passthrough entities, including sole proprietorship and partnership. this means they file taxes at the individual rate, because business and individual earnings are combined and can be taxed on the highest end at 39.6%. meanwhile, the corporate tax rate is 35%. small business advocates believe more business investment and creation may follow if the plan is passed into law. entrepreneurs like laurie sprouts, owner of destination management company ultimate ventures in dallas, says the tax

code puts her on an uneven playing field with her corporate competitors. >> we have competitors that are getting taxed at the corporate rate. and so for us, being taxed at the individual rate, i'm married, and so my spouse may have a really good year, and so we're going to get taxed at the higher rates even if we -- even if i wouldn't be there on my own. >> reporter: while tax reform is certainly welcome among small business owners, not all are confident it will come to fruition. a recent survey from the nonpartisan national small business association found nearly one-third of small business owners believe comprehensive tax reform will never be enacted. for "nightly business report," i'm kate rogers. as you probably know, the stock market has been rallying on the expectation of tax cuts. but today, the announcement failed to give stocks a lift. the dow jones industrial average dropped 21 points to 20,975. the nasdaq fell fractionally.

and the s&p 500 was off one. so there was the initial reaction to the president's tax proposal. what is next? mark lehman is president of jmp securities, joins us now to discuss. mark, i guess you could say it was a case of buy the rumors and sell the news. you could say maybe the market was a little disappointed in what it saw. what do you think happens next with respect to the market's reaction to the trump agenda and tax reform specifically? >> yeah, i think your assessment is right, tyler. i think the market was expecting something like this. i think the rush to get it out before the magical hundred days on saturday, that happened, and this was very much in line with what we heard from candidate trump and now we see it under president trump. there's a lot of devil in the details. most people have been relatively quiet on the democratic side. i think there's going to be a lot of work ahead. the reason we haven't had any tax reform of massive note in 30 years is because it's really hard to do, and you've got a lot of constituents who have got a

lot invested here. and i think there's going to be -- the reason the market didn't react is, this isn't very much looking to me like health care, drawn out, a lot of compromise, and more will be with the status quo than big legislation. we'll see tweaks as opposed to massive legislation. >> it sounds as though you think the odds of it actually passing intact as it is now are relatively low, is that a correct reading? >> i think that's right. i think the odds of this much change and this much -- actually of a sea change in how we tax people and those important deductions that have been the bedrock of our tax policy changing -- to me, change is glacial. this is a huge change. the odds of this becoming law i think are quite remote. >> and we really can't tell, secretary mnuchin said today basically for individuals the only deductions that survive are mortgage interest and charitable, but he did not go

into deductions specifically with respect to business. and that's were businesses have traditionally lowered their taxes. for example, there's been a lot of talk about immediate expensing or the deduction of capital investment in equipment. that wasn't mentioned today. so we really don't know how different businesses or sectors are going to fare, do we? >> we don't. what we have is some headline numbers that look very attractive to people. when you see a 15% number for corporate tax, that sounds attractive, but again, underneath, it covers a lot of specifics we don't know. there's a lot of cash held overseas that we've often talked about, repatriating that cash and taxing it one time, that's a well-versed way to raise some revenue, it's quite likely. but again, the devil is in the details. that's why i think the market was very, very quiet today. you had bonds rallying a bit, which was interesting, it stuck at the 230 level. i think this will be a long

process. this is going to take a long time. it's april now. let's have a conversation at the end of the summer and see what we're at. >> mark, thank you, we appreciate it, with jmp security. much of the attention today was on the white house's tax proposal. some progress was also made on the funding bill that needs to be passed by friday or we risk the shutdown of the government. kayla tausche is in washington tonight. where do the negotiations stand at this point? >> reporter: sue, lawmakers are pursuing short and long term options. the long term option would be that full spending bill that republicans are still optimistic they can get by the end of the week. congressman tom cole, who sits on the committee that will be tasked with allocating the money in the bill says today he's hopeful they will still see a full spending bill. the short term option could be filed as soon as tonight, according to some reports. that could be a one-week stopgap short term fix to keep the government open so it does not shut down while some of these

last-minute fixes are worked out. the white house has been somewhat involved this week, particularly on two matters. earlier in the week they backed away from a push to provide funds for the controversial border wall, the president saying he would push that until later this fall so this bill could go through. today white house officials say they will at least in the interim make some payments to insurers that will lower costs of obamacare premiums. that had been hotly contested. on that specific point, senator chuck schumer said today, quote, like the withdrawal of money for the wall, this decision brings us closer to a bipartisan agreement to fund the government. so there is progress being made. there is optimism as there often is in washington. but the clock is running out. >> kayla, do you get the sense that it's going to play out the way it has in the past, where it's right up to the last minute, which has created an awful lot of market volatility? or do you get the sense that enough movement is taking place that we may not take it up right

to the bottom line? >> reporter: well, you never know, sue. and last week, when i was doing some reporting on what the options were, the idea of a one-week short term fix had been floated. and certain republicans were saying, well, we wouldn't do that until the very end, because that's when you get the pressure, that's when you get the last-minute changes in positions, really when you get up to the deadline, and then you have some defections on the these bills. so we'll see. they do like it to go up to the very end. it was expected that with republican control at the white house and at congress, we wouldn't get this close. but this is where they get some of that pressure. >> kayla, thank you. kayla tausche in washington. there are reports tonight that the president is considering pulling out unilaterally of the north american free trade agreement. as first reported by politico, the white house is considering drawing up an executive order that could pull the u.s. out of the pack. the timing of the order unclear right now. on that report, though, the dollar advanced against the

mexican peso and the canadian looney. still ahead, the stock that suffered its biggest one-day decline ever. these days investors are basically focused on two things: taxes and earnings. today, three big blue chips, boeing, united technologies, and

procter & gamble reported their quarterly profits, but with mixed results. dominic chu has more. >> reporter: after two straight days of big gains for the dow jones industrial average, stocks calmed down a bit as three big dow component companies reported earnings that were generally mixed. one upside performers, industrial conglomerate united technologies which makes everything from otis elevators and what the and whitney jet engines. it rose thanks in part to european orders and signs of momentum in the global economy. shares of boeing were among the biggest drags on the dow today. the aerospace and defense giant reported better than expected earnings although sales fell short of expectations, due in part to fewer deliveries of aircraft. on a more positive note, it did boost projections.

the stock is up by 17% from last year so perhaps a pullback is not a surprise. procter & gamble, responsible for big brands like tide laundry detergent and pampers diapers also reported mixed results with sales that narrowly missed expectations. procter & gamble said geopolitical instability could be affecting market growth and continues to see headwinds in markets. >> it's geopolitically volatile in this country as well. saudi is one of our top 15 markets. the prototypical saudi consumer has had their income cut by 20% while energy prices that they pay have increased and are set to double again in july. so that's an example of a very difficult market. and in those markets, as you could expect, it impacts consumption. >> reporter: when it comes to the dow, traders will be

carefully watching four more components that will report this week. tomorrow, we see results from tech titans microsoft and intel. and on friday, we'll have oil giants exxonmobil and chevron. for "nightly business report," i'm dominic which did you. u.s. steel has its biggest one-day drop since it went public back in 1991. that's where we begin tonight's market focus. last night the company surprised wall street with a large quarterly loss. the bad news didn't end there. the steel maker said plans to improve its mills would eat into profits, causing the company to cut its guidance for the full year. investors punished shares, u.s. steel dropping nearly 27% to $22.78. twitter reported user growth that beat expectations, which the company credited to improvements to its platform.

despite a drop in revenue, shares rose 8% on the session to $15.82. pepsi reported profit and sales that rose and beat estimates thanks in part to strong demand for thealthier prod >> tax refunds for certain payers were delayed until february 15th. we saw it in our business in the first six weeks of the year. as we exited march and now we're about to exit april, the business has really bounced back very strongly in the united states. overall, i think the consumer is optimistic. but a bit cautious in the united states. and that's not a big change from where we've been before. if anything, it's probably slightly better. >> still, the company gave weak guidance for the year, and shares fell 83 cents to $113.33. anthem said higher premiums and a rise in enrollment helped it post profit and revenue that

topped estimates. the health insurer raised its full year adjusted earnings outlook and said it would consider leaving state exchanges in 2018 if the government doesn't continue paying subsidies for lower income members. shares rose more than 3% to $179.03. fiat chrysler reported earnings ahead of expectations as the automaker saw strong demand for its maserati brand and its european market. the company confirmed its guidance for the year. fiat chrysler shares went to $11.65. northrop grumman said an increase in f-35 fighter jet deliveries helped that country post stronger than expected sales. the defense contractor also posted profit ahead of estimates and said it was raising its earnings guidance for 2017. the shares were off 7 cents to $248.06. coming up, why the fcc wants to rewrite the rules of the internet -- again.

espn is laying off 100 on-air personalities and writers. the network, easily the biggest in sports broadcasting, has lost more than 10 million subscribers over the past several years, as the cost of broadcasting rights for live events has continued to

rise. this is the second round of layoffs at espn in less than two years. espn is owned by disney. the rules governing the internet could soon change. and that could impact both the companies that make it run and users like you and me. julia boorstin explains. >> reporter: fcc chairman ajit pai taking the stage to outline the future of internet regulation and to propose rolling back net neutrality rules enacted under the obama administration in 2015, particularly a regulation which regulates internet service providers as if they were utilities, which pai says has stifled growth and called $5 billion in investment. >> what we don't want is heavy handed regulation that stands in the way of building next generation networks. >> reporter: the fundamental idea of net neutrality is that internet providers should be mandated to treat all traffic on their pipes easily.

the internet association which represents internet companies including google and netflix, says consumers pay for access for the entire internet. consumer advocacy group free press says pai's proposed change would put consumers at the mercy of phone and cable companies. internet service providers generally oppose the more stringent regulation of title ii, comcast saying it supports the reversal of that part of the regulation but that it also supports a free and open internet and does not block, throttle or discriminate against lawful content. pai says his proposal will ultimately benefit consumers. >> we want to give more consumers better, faster, cheaper internet and getting rid of these heavy-handed economic regulations inspired in the great depression is the way to do it. >> reporter: what's next? chairman pai will put his proposal to review the rules up

for a vote on may 18th, the fcc's next meeting. that will set off a process of public comment. after four to six months, incorporating that feedback, pai would propose a final rule for a vote. for "nightly business report," i'm julia boorstin in los angeles. that does it for "nightly business report" tonight. i'm sue herera. thanks for joining us. >> and thanks from me as well. i'm tyler mathisen. y'all have a great evening. we'll see you back here tomorrow.