Republicans Weigh Tax Hikes For The Rich In Trump’s ‘Big Beautiful’ Budget Bill

Republicans in Congress are weighing tax increases on the wealthy as part President Donald Trump’s sweeping “big, beautiful” budget bill, marking a dramatic break from decades of GOP tax orthodoxy.

Talks are still in the early phases, and lawmakers reportedly warn that a tax increase may not make it into the final bill. However, the consideration of tax hikes highlights the challenges Republican face in balancing demands from fiscal conservatives and populists.

NEW: Congressional Republicans are considering raising taxes on the extremely wealthy as part of President Trump’s ambitious and populist legislative plan, the “big beautiful bill.” One proposal under discussion is raising the top tax to 39.7% on income exceeding $1 million.

— Election Wizard (@ElectionWiz) April 17, 2025

One proposal under discussion is a 40 percent top tax bracket on income over $1 million, Bloomberg first reported.

Republican Iowa Sen. Chuck Grassley confirmed the proposal during a town hall on Tuesday when asked about taxing billionaires.

“It might surprise you — members of the Finance Committee —  are going to discuss is raising from 37 percent to 39.6 percent on the very group of people you talk about,” Grassley said.

“Now, that doesn’t mean it’s going to happen,” Grassley clarified. “The rationale for it is, we can take that money and use it for increasing child tax credit.”

The current top tax bracket is 37 percent for incomes above $609,351. Republican lawmakers advanced a budget blueprint last week without the tax increase.

Raising taxes on the wealthy could help with the bill’s cost, though fiscal hawks want it to be deficit-neutral, while moderates oppose cuts to Medicaid. House GOP leaders are reportedly opposed to the tax increase.

Former President Donald Trump has also criticized raising the top tax rate, warning during his campaign that Democrats would push it “up to 39 or 40 percent or maybe even 50 percent.”

House Speaker Mike Johnson pushed back on the idea of a tax hike last week, saying, “We’re for tax reduction for everyone.”

He emphasized the Republican Party’s commitment to lowering taxes, a stance echoed by Republican New York Rep. Elise Stefanik and former House Speaker Newt Gingrich, who called proposed increases “madness” in a post on X. (RELATED: NEWT GINGRICH: We Must Stop The Republican Tax Increasers)

Still, some Republicans are open to the idea.

Even after George Bush Sr. broke his tax promise and agreed to tax rate hikes, did the Democrats give him credit for that?

Nope.

In fact, Bill Clinton ran nonstop ads in 1992 slamming bush for the tax increase and still accused Bush of wanting “tax cuts for the rich.” pic.twitter.com/WqXbezpIrf

— John Kartch (@johnkartch) April 17, 2025

Republican Maryland Rep. Andy Harris, chair of the House Freedom Caucus, called a 40 percent tax bracket a “reasonable way to pay for” Trump’s priorities.

Republican Texas Rep. Chip Roy also broke with party leaders, warning that unfunded tax cuts could be just as damaging.