The Trump White House will need to provide more clarity on tax reform before mergers and acquisitions really take off, Morgan Stanley's M&A chief Robert Kindler said on Monday.
After the House Republicans' failed health-care bill last month, President Donald Trump said the administration would move "strongly" on a plan to broadly cut taxes.
Like repealing and replacing Obamacare, reducing tax rates was a central promise by Trump during his presidential campaign. Investors have had doubts about the time frame for a tax proposal, with some not expecting reform until next year.
"No one knows what's going to happen with corporate rates. No one knows what's going to happen with repatriation. How can you actually do deals on a large scale when there's so much uncertainty?" Kindler, vice chairman and global head of M&A at Morgan Stanley, said on CNBC's "Squawk on the Street."
Kindler's remark came as M&A deals were down 4 percent in the first quarter of 2017 vs. the same quarter last year. Despite the uncertainty in dealmaking, Kindler said the U.S. market is much stronger than he once thought.
"People still feel that they need to do deals," he said.
On Friday, Reuters reported Trump doesn't have a clear plan on tax reform or an adequate staff to see it through. The report came after Trump promised in February a "phenomenal" tax announcement by early March, which did not happen.
During an Axios event in Washington last month, Treasury Secretary Steven Mnuchin said he will push for "comprehensive" tax reform by Congress' August recess.
Mnuchin said the objective for tax reform is a tax cut for the middle class, not the top 1 percent.