The "phase two" tax cuts proposed by President Donald Trump could "outdo" the one passed by Republicans in December, economist Arthur Laffer told CNBC on Thursday.

Laffer, who was a member of President Ronald Reagan's economic policy board and helped pass the Tax Reform Act of 1986, said on "Squawk Box" that Trump should reduce the number of tax brackets, which currently stands at seven, even further. He also said Trump should get rid of the "deductions, exemptions, exclusions and loopholes" in the tax code.

"There's a lot of tax reform to be done," said the founder and CEO of Laffer Associates. "When you look at some of these loopholes, they're just outstandingly large. They make no sense whatsoever."

House Ways and Means Committee Chairman Kevin Brady is talking to the White House about a possible "phase two" of the GOP tax plan. Speaking at the White House on Monday, Trump hinted that there could be a second part to the law passed late last year.

Laffer also said Trump will be served well by Larry Kudlow, the long-time CNBC senior contributor and economist picked to succeed Gary Cohn as the top economic advisor. Laffer, the father of the supply-side economics championed by Kudlow, has known Kudlow for more than 40 years.

"Trump couldn't be better served than by having Larry Kudlow," said Laffer. "Larry always calls it straight and yet he's a team player. ... He's the perfect person for this job. Just perfect."

On Wednesday, the White House confirmed Kudlow accepted the post of National Economic Council director. Trump offered Kudlow the job Tuesday night after other conversations between the pair on Sunday and Monday.