Trump Says He Plans To Only Allow Car Loan Interest Deduction For US-Made Vehicles

Republican presidential candidate Donald Trump said on Tuesday that his plan to make interest incurred on car loans fully tax deductible will only apply to vehicles built in the United States.

At a rally in Greensboro, North Carolina, the Republican presidential nominee said, "I will make interest on car loans fully tax deductible. I am only going to do it if they build that particular product - namely an automobile - in the United States."

"I don't want it to benefit other countries. I want it to benefit us."

"So its deductibility of interest is great, but only if the car is manufactured in the United States," Trump pledged. "Is that a great idea?"

According to the former president, if his plan was not limited to U.S.-made cars, it could advantage countries like China, allowing them "to make more cars," the New York Post reported.

"Why the hell would we give them taxes if they manufacture the car in China or Japan or lots of other places that stole our business over the years?" he asked.

Trump announce his plan to end taxes on auto loan interest earlier this month but did not provide any details.

This proposal is part of a broader strategy by the former president aimed at boosting auto production in the U.S.

The plan also includes cutting the tax rate to 15% for companies that make their products in the country. It also includes increasing tariffs by as much as 200% on cars imported from Mexico.

Trump also proposed the idea of further expanding research and development of tax credits of American automakers.

During his remarks, Trump said it is going to be "great for Detroit." He also claimed to be "leading in Michigan," another critical swing state.

Trump claimed that tariffs on cars will help the economy two fold.

"Tariffs are two things if you look at it," Trump said. "Number one it is protection of the companies that we have here and the new companies that will move in. You will have thousands of companies coming into the country and we will grow it like we have never grown it before and we will protect them because we will not have somebody undercut them."

Trump's vision seems to be rooted in building large auto plants in states that were once known for their auto factories.

The former president claimed the tariffs will help the U.S. compete with Mexico, a country he views as having many advantages when it comes to building car factories.

While the president can impose tariffs, tax code changes would need congressional approval.