The Trump administration may allow tax rates for the wealthiest Americans to rise in order to pay for the presidentâs plan to eliminate taxes on tipped wages, according to a report.
A senior White House official suggested to Axios on Friday that letting income rates on the nationâs highest earners go back to pre-2018 levels might be the most politically palatable option to cover the cost of fulfilling President Trumpâs campaign promise.
“If we renew tax cuts for the rich, paid for by throwing people off Medicaid, we’re gonna get f—ing slaughtered,” the official was quoted as telling the outlet.
The Tax Cuts and Jobs Act of 2017 lowered the income tax rate on top earners â $609,351 or more for an individual and $731,201 or more for a married couple â from 39.6% to 37% during Trumpâs first term.
If the law is allowed to expire on Dec. 31, about 1% of taxpayers in the top bracket would see their rate move back up. The earnings threshold for the top bracket would also be lowered.
Some White House officials, according to Axios, believe that a GOP-led reversal on taxes would allow the Trump administration to turn the tables on Democrats, who have long called for higher levies on the wealthy and have attacked the president and Republicans for wanting to extend the 2017 tax cuts.
The White House did not respond to The Postâs request for comment.
While the GOP under Trump has catered more to working-class voters than in the past, raising taxes would fly in the face of conservative economic principles.
Itâs unclear how receptive congressional Republicans and wealthy GOP megadonors would be to such a proposal.
Congressional Republicans are already moving forward with plans to raise the nationâs debt limit by trillions of dollars and pass Trumpâs border, energy and tax priorities by Memorial Day.
House Republicans approved a budget framework last month that included an extension of the 2017 tax package.
Treasury Secretary Scott Bessent warned that the country would face “economic calamity” if the 2017 tax cuts are not extended during his Senate confirmation hearing in January.
âThis is the single most important economic issue of the day,â Bessent argued, claiming that the financial fallout would hit middle and working-class people the hardest.
Bessent noted that allowing the cuts to sunset would result in aâcrushing $4 trillion tax hikeâ â the largest in US history.
The post White House weighing tax hikes for rich to pay for Trump’s no tax on tips promise: report appeared first on New York Post.
