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Trump's one-pager on tax reform 'stirred up a lot of dust,' says Brookings' David Wessel

Key Points
  • Brookings' David Wessel says President Donald Trump's tax plan is in trouble.
  • Wessel expects a small corporate tax cut.
  • He predicts the border adjustment tax will make a reappearance.
Tax reform is in real trouble: David Wessel

President Donald Trump's one-pager on tax reform "stirred up a lot of dust," but didn't clarify much, Brookings Institution's David Wessel told CNBC on Monday.

"I think the tax bill is in real trouble," Wessel, a Wall Street Journal veteran, said on "Squawk Box. " "You can see there's a disagreement between the House and Senate. There's disagreement among Republicans on the Hill and in the White House."

On Wednesday, top administration officials Gary Cohn and Steven Mnuchin outlined Trump's long-awaited tax plan, which included slashing tax rates for businesses, but offered no specifics on how it would be paid without increasing the deficit.

Some Republicans, who slammed the growing national debt under former President Barack Obama, said they were open to Trump's tax plan, arguing the cuts could spur economic growth.

Other Republicans have said the Trump's tax cuts won't pay for the increased spending he has proposed.

Most independent analyses of Trump's campaign tax plan said it would balloon the budget deficit over time, even after higher tax revenue from greater economic growth is factored in.

Wessel, who spent 30 years at the Journal before joining the think tank, said he doesn't expect a "dramatic" cut in the corporate tax rate but a "small" one. He added the border adjustment tax is also likely to make a reappearance.

"I think the problem with the border adjustment tax is it's not a dumb idea, it's very complicated, [but] the system isn't ready for it. So it'll come back in some form," he said.

—CNBC's Jacob Pramuk and The Associated Press contributed to this report.