President Donald Trump allegedly urged House Speaker Mike Johnson (R-La.) during a phone call Wednesday to raise the top tax rate, albeit at a much higher income level, and close the carried interest loophole amid Republican lawmakers’ efforts to finalize their Trump agenda bill.
The president indicated a change of mind Friday morning, however, suggesting on Truth Social that “Republicans should probably not do it.”
Last month, Trump and Johnson shot down the idea of a tax hike on the wealthiest Americans.
The president said in his April 22 interview with Time magazine, “I certainly don’t mind having a tax increase.”
‘Our party is the group that stands against that traditionally.’
“I actually love the concept,” continued Trump, “but I don’t want it to be used against me politically, because I’ve seen people lose elections for less, especially with the fake news.”
The following day, Trump came out against the idea more forcefully, telling reporters in the Oval Office that the idea of a tax hike was “very disruptive,” as it might prompt wealthy individuals to flee the country, reported Politico.
“You know, the old days, they left states. They go from one state to the other. Now with transportation so quick and so easy, they leave countries. You lose a lot of money if you do that,” said Trump.
Johnson similarly came out swinging against a tax hike on April 23, telling “The Will Cain Show” last month, “We have been working against that idea. I’m not in favor of raising the tax rates because our party is the group that stands against that traditionally.”
A number of provisions enacted by the Tax Cuts and Jobs Act of 2017 are set to expire in December. Unless lawmakers extend the cuts, tax brackets will revert back to pre-TCJA levels. Accordingly the top individual, estate, and income tax bracket would return to 39.6% from the current rate of 37%.
One unnamed Republican source said to be familiar with Trump’s Wednesday call with Johnson told NBC News that the president was considering allowing the rate to revert to 39.6% “to protect Medicaid and help pay for middle- and working-class tax cuts.”
Multiple sources suggested to The Hill that while the White House advocated for allowing the top marginal income tax rate cut to expire, the administration wanted to see the 2017 cuts extended for Americans in the lower tax brackets. While the top income bracket starts this year at $626,350 per individual, the New York Times indicated the proposed restoration of the previous top rate would apply to individuals earning over $2.5 million annually.
The Hill noted that a spokesman for the House Ways and Means Committee declined to comment on any policy specifics under consideration, and the White House did not return the outlet’s request for comment.
‘I’m OK if they do!’
When asked about the proposed tax income increase on the upper brackets, Sen. Mike Crapo (R-Idaho), chairman of the Senate Finance Committee, told “The Hugh Hewitt Show” Thursday that he was “not excited about the proposal but I have to say there are a number of people in both the House and the Senate who are.”
Crapo added, “If the president weighs in in favor of it, then that’s going to be a big factor that we have to take into consideration.”
Trump noted in a social media post on Friday, “The problem with even a ‘TINY’ tax increase for the RICH, which I and all others would graciously accept in order to help the lower and middle income workers, is that the Radical Left Democrat Lunatics would go around screaming, ‘Read my lips,’ the fabled Quote by George Bush the Elder that is said to have cost him the Election.”
“NO, Ross Perot cost him the Election!” continued Trump. “In any event, Republicans should probably not do it, but I’m OK if they do!”
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