Latest news with #Norquist
Yahoo
28-05-2025
- Business
- Yahoo
GOP rejects ‘millionaire tax' pitch, advancing breaks for rich Americans
House Republicans rejected a push by some allies of President Donald Trump to include tax hikes on the rich in sweeping legislation they passed last week - a decision that could carry repercussions into next year's elections. For a moment, though, that outcome seemed uncertain. On May 7, the anti-tax activist Grover Norquist had about 15 minutes before boarding his flight to Poland this month when his phone rang - with a call from the president. In the time before the plane took off, Trump gave his arguments for raising taxes on the rich in the sweeping Big Beautiful Bill that congressional Republicans were working on. Norquist pushed back, arguing that such a maneuver would prove a politically disastrous 'attack on the small-business community,' he said of the call. Shortly after landing in Warsaw, Norquist received a follow-up call from House Speaker Mike Johnson (R-Louisiana), who told him the tax increase would not be in the final legislation. Subscribe to The Post Most newsletter for the most important and interesting stories from The Washington Post. The legislation House Republicans approved last week extends tax cuts Trump signed into law in 2017, cutting rates across income groups, including large benefits for the Americans who pay the highest share of federal income tax - those in the top 5 percent of the income distribution. The measure excluded a 'millionaire tax,' and other proposals to raise taxes on top earners pitched by Stephen K. Bannon, the president's first-term chief strategist, and other allies of the president. The Senate could make further changes, but Republicans in the upper chamber are expected to prove even less likely to back higher taxes on the top income bracket, several analysts said. The issue may help define the upcoming battle over the GOP's key legislative achievement ahead of the 2026 midterm elections. While Sen. Josh Hawley (R-Missouri) told reporters last week that Trump is still pushing legislation to raise taxes on private-equity groups, the GOP is poised to largely reprise the strategy of its 2017 tax bill, which the party struggled at times to sell to voters the following year. Democrats attacked that legislation as skewed for the rich - and won control of the House in 2018 - but efforts to reorient the GOP around a more populist policy program this year appear to be stalling. 'We showed how weak and nonexistent this quote-unquote 'movement' for higher taxes is within the Republican Party,' Norquist said. 'The House and the Senate have been in lockstep: This is not happening, period. But I'm glad we had this movement because it allowed us to expose this little cancer cell in the party pushing the idea.' Now, the GOP tax bill would deliver larger gains to affluent Americans than middle- or working-class households, several analyses have found. The White House has pointed to estimates showing average-income Americans would also receive a substantial tax cut, and to a provision that would cut a tax benefit for wealthy owners of sports teams. But the legislation includes several measures that critics say disproportionately benefit Americans at the top of the income distribution. It extends the tax cut Republicans first approved in 2017 for the highest income bracket, those earning more than $626,000 per year. The bill passed by the House also expands the estate tax (or 'death tax,' as many conservatives refer to it), which would not apply to fortunes of up to $15 million, or $30 million for married couples. It also increases a tax deduction for certain businesses formed as 'pass-through' entities, for which owners pay taxes on their individual income tax returns. Most of the bill's more than $2.5 trillion price tag comes from measures that primarily benefit middle-class taxpayers, such as increasing the child tax credit and the standard deduction paid by most Americans. But because rich households have higher taxable incomes, lowering rates by about the same size across income brackets means significantly larger savings for the affluent. The average American would receive a roughly $1,700 tax cut from the bill in its first year, according to the Institute on Taxation and Economic Policy, a left-leaning think tank. By contrast, the top 1 percent of earners - making more than $920,000 - would receive an average tax cut of close to $70,000 in the first year after enactment, the think tank found. Taxpayers earning more than $3.4 million per year would receive a roughly $275,000 boost in 2027, while the bottom 40 percent of the income distribution - or those with less than $13,000 in annual income - would go down due to cuts to social programs such as Medicaid and food stamps, a Yale Budget Lab analysis found. Because there are so many more taxpayers earning moderate incomes than those earning high salaries, most of the bill's cost would go to tax cuts for the non-rich, even though higher-income taxpayers would, on average, see bigger benefits. Roughly 30 percent of the benefits of the House GOP bill would go to corporations and those earning more than $400,000 per year, according to a rough estimate cited by Jessica Riedl, senior fellow at the Manhattan Institute, a center-right think tank. The biggest beneficiaries of the bill would be those earning between $460,800 and $1.1 million per year, a category primarily composed of small-business owners and high-income professionals such as lawyers and doctors, according to Kyle Pomerleau, senior fellow at the American Enterprise Institute, a center-right think tank. After that, the top 1 percent are the biggest winners, Pomerleau said. 'It's a complete shifting of resources up to the wealthiest Americans - that's the bottom line of it,' said Steve Wamhoff, a tax policy expert at ITEP. GOP policymakers reject these criticisms. The White House Council of Economic Advisers argues that average take-home pay would see a short-run boost of between $7,800 and $13,327, along with more than 7 million additional jobs saved or created and an investment boom up to 15 percent. One White House official, speaking on the condition of anonymity to reflect the administration's thinking, pointed to an estimate by the nonpartisan Joint Committee on Taxation showing that people making between $30,000 and $80,000 would pay around 15 percent less in taxes in 2027. The official said there was a reason that Democrats' criticisms of the legislation have focused on its cuts to Medicaid, rather than its benefits for the rich. The tax cuts at the top end of the income scale also significantly benefit millions of businesses whose owners pay taxes on their individual income returns, said Doug Holtz-Eakin, president of the American Action Forum, a center-right think tank. Many of the Americans who appear to be in the top 1 percent and would see a tax cut only temporarily have high incomes - perhaps because of a one-time sale of their business - and are not part of the billionaire elite of Democrats' imagination, Holtz-Eakin said. Even tax legislation that helps the rich could prove popular. Doug Heye, a GOP strategist, argued that the party's setbacks in 2018 were more due to Trump than the tax plan specifically and that it will take time for voters to react viscerally to the measures in this legislation. 'There's been a lot of Democratic talk, but it's way too early to say' what the political impact of the 2025 tax bill will be, Heye said. The current legislation also includes some populist measures, such as reducing taxes on income through tips, not in the 2017 bill. And the legislation would leave the corporate tax rate unchanged, despite a push from the private sector to lower it again. But Republicans don't seem to be explicitly going after the rich - a strategy some Democrats had feared could change the dynamic in next year's midterms. Bannon had pitched Trump not just on allowing the tax cut for the top bracket to expire, which would effectively be a tax increase, but also on creating a new bracket for those earning more than $1 million per year. These ideas had drawn support from some of Trump's top aides in the White House. But GOP lawmakers ultimately showed little appetite for such measures, at least in the House. 'What we're seeing is the center of gravity in the Republican Party is still much closer to where it was under Mitt Romney than is commonly thought - there's support for Trumpian nationalism, but it's not the dominant disposition in the way a lot of people think it is,' said Michael Strain, economist at the American Enterprise Institute. 'Rather than there being no Republicans who want to boost taxes on the rich, there are just very few.' - - - Theodoric Meyer contributed to this report. Related Content Despite ceasefire, India and Pakistan are locked in a cultural cold war The D.C. plane crash took her mom and sister. She turned to her piano. Johnson again corrals GOP factions to pass Trump's sweeping tax bill
The Hill
10-05-2025
- Business
- The Hill
Trump millionaire tax hike idea upends Republican political wisdom
President Trump's last-minute pitch to raise taxes on the highest-income Americans could be rewriting the conventional Republican political wisdom on the issue. The president has sent mixed messages publicly about where he stands on the policy, and whether he thinks it's good politics — both recognizing the political perils of reneging on a promise to keep tax rates lower, while seeing the upside in neutralizing Democratic arguments and finding more revenue. The millionaire tax hike suggestion came as House Republicans are rushing to iron out the thorniest portions of President Trump's legislative agenda together before meeting to advance the bills next week. The House Ways and Means Committee released partial text of the tax portion of the bill on Friday that did not include a new tax bracket for millionaires. The committee is expected to make additions and changes to that text, though, and could potentially add it in by the end of a meeting scheduled for Tuesday afternoon. But even if Republicans fully abandon the idea of taxing the rich more in this legislation, the back and forth has broken open arguments that have typically been off limits to Republicans could affect policymaking going forward. Republicans had previously floated — and then ruled out — the idea of making high income earners pay more. The idea, however, bubbled up again from the White House this week as tax-writers met to try to nail down the tax legislation's details. A source familiar with the president's thinking told The Hill on Thursday that Trump was 'considering allowing the rate on individuals making $2.5 million or more to revert from 37% to the pre-2017 39.6%,' arguing it would 'help pay for massive middle and working-class tax cuts, and protect Medicaid.' That spurred a wave of opposition from tax-cut crusaders and resistance from some GOP lawmakers, many of whom argued it could harm small businesses owners. Americans for Tax Reform President Grover Norquist, who has long worked to have politicians sign pledges to not raise taxes, said that Trump called him to ask his opinion about the matter on Wednesday. 'I told him I thought that it was a job killer, that it was bad for the economy, that it was political death,' Norquist said, reminding him of the many times he promised to make the 2017 tax cuts permanent. And suggestions from staff to the contrary, Norquist said, would not serve him politically. 'That's what Darman did to Bush,' Norquist said, referencing the Office of Management and Budget director for former President George H.W. Bush — who lost reelection after making the promise, 'Read my lips: no new taxes,' before agreeing to tax increases. 'That's kind of a disgusting thing for a staffer to do to a president, is to tell him to go out and change his mind and say, 'Oh, I lied when I ran for office,'' Norquist added. Trump referenced the infamous Bush quote in a Truth Social post on Friday when he said Republicans should 'probably not' raise on those pulling multi-million-dollar incomes, musing that Democrats could use it against Republicans. But Trump also said it was not that broken promise that lost Bush in 1992: 'NO, Ross Perot cost him the Election!' Trump said, referencing the independent presidential candidate who pulled nearly 19 percent of the popular vote. The tax hike idea, however, garnered interest from other fiscal hawks eyeing ways to keep the overall costs of the massive legislation down. Rep. Chip Roy (R-Texas) — one of the biggest fiscal hawks in the House — saw the prospect of higher taxes for the wealthiest as a good way to even out the legislation's balance sheet. 'I think it's wise of him to be putting that on the table,' Roy said of the proposal. 'And I think a lot of people on my side of the aisle reflexively throw up on these kinds of things when we got to put a package together, right? And that means moving some things around.' House Republicans have approved a framework that allows for $4 trillion to $4.5 trillion in tax cuts — including extending tax cuts that Trump signed into law in 2017 — if they can find $2 trillion in spending reductions elsewhere. Trump has also called for ending taxes on tips and overtime, while other Republicans are seeking to increase the state and local tax (SALT) deduction cap — all expensive propositions, and the impacts of which could potentially be lessened with a tax hike for the rich. And with Republicans drafting a number of reforms to Medicaid and other assistance programs that result in billions in savings, they are wary of the talking point from Democrats that Republicans are cutting entitlements for the poor to pay for tax cuts for the rich. Trump on Friday afternoon pointed to those political optics as an argument in favor of the tax hike. 'I actually think it's good politics to do it, where richer people give up — and it's a very small, it's like a point — but they give it up to benefit people that are lower income,' Trump said, according to a pool report. Norquist, for his part, said he feels confident that Republicans will not raise taxes based on his public comments — and that Trump and GOP leadership have agreed to take the millionaire tax off the table. 'He's not saying, 'Please vote for this,' You know? He's saying, 'Probably not a good idea, it did cost Bush the presidency,'' Norquist said. Republican leadership is not publicly completely ruling out the prospect yet, even as they express disapproval of increasing taxes. 'Well, I don't want to see taxes go up on anybody,' Senate Majority Leader John Thune (R-S.D.) said on CNBC Friday morning in response to the news about Trump pushing for a higher rate. 'I mean, we're all about lowering taxes, we're not about raising taxes.' 'But I do think the president – he's not a conventional president. The people didn't vote for a conventional president,' Thune said. He added that the House lawmakers are going to have to make all of the president's policies fit within the they've set. The Senate Leader also hinted that Republicans were looking at multiple different ways to increase that tax burden on the rich — like a threshold of an increase for those making $5 million individually or $10 million as a couple, rather than the $2.5 trillion and $5 trillion figures. Norquist said that Republican leadership declining to publicly rule out the tax hike idea was keeping with their stance of declining to confirm any details of the tax legislation. 'I'm not losing any sleep over the idea that this is something other than that,' Norquist said. National Economic Council Director Kevin Hassett added to the intrigue about Trump's thinking on the matter. 'He's not thrilled,' Hassett said of Trump's thoughts on the increase on CNBC Friday morning. 'He understands the argument. It's one of the things the Senate and the House has to work out. … It's not high on the president's priority list,' Hassett said. Trump, though, said Friday afternoon that he 'would love to do it' — but as for Republicans in Congress? 'I don't think they're going to do it,' the president said. Mychael Schnell contributed.
Yahoo
09-05-2025
- Business
- Yahoo
Trump's float of a tax hike for the wealthy quickly runs into GOP resistance
President Donald Trump's last-minute push to raise taxes on the wealthiest Americans is running into a buzz saw of opposition in the Republican Party, where such proposals have long been anathema. As congressional Republicans assemble a massive tax-and-spending-cut package to deliver on Trump's domestic policy agenda, the White House has been kicking around the idea of allowing the tax rate on top earners to go up as a way to pay for other priorities on taxes, immigration and the military without cutting programs like Medicaid that millions of Americans rely on. But the proposal received swift pushback from Republicans behind the scenes this week, raising doubts about whether it will appear in the party's package, though a draft has still not been finalized. Trump — who has sent mixed signals on the matter over the past few weeks — floated the idea of bumping the top rate for those making at least $2.5 million annually from 37% to 39.6% during a phone call with House Speaker Mike Johnson, R-La., on Wednesday, as NBC News previously reported. In a Truth Social post on Friday, Trump said that he would 'graciously accept' a ''TINY' tax increase for the RICH,' while also warning of potential attacks from Democrats. He said Republicans should 'probably not do it' but that he would be 'OK' if they did. And later Friday, Trump said it he thought it was "good politics" to raise taxes on the wealthy "to benefit people who are lower income." 'But I don't think they're going to be doing it," he said. Grover Norquist, the president of Americans for Tax Reform, told NBC News that Trump called him on Wednesday to seek his input on a tax hike for top earners. Norquist said he pushed back hard on the proposal, citing both economic and political reasons. 'I gave him my sense of why I thought any discussion of increasing rates was a bad idea: because it would kill jobs, it is damaging to small businesses, nobody in the campaign ever discussed this as an option,' Norquist said. 'The other part is, the entire Republican Party is against it.' Norquist said Trump sounded receptive to his argument, and that the president even raised the example of how President George H.W. Bush suffered politically for backtracking on his infamous 1988 campaign pledge, 'Read my lips: no new taxes.' Trump also referenced Bush's pledge in his Friday Truth Social post. The idea of a tax rate increase also did not go over well with Republicans on Capitol Hill, although they entertained the idea following Trump's call with Johnson on Wednesday. House and Senate GOP leadership — which has long been resistant toward raising the top tax rate — communicated to lawmakers and aides by Thursday evening that there aren't enough votes for a tax hike on the wealthy, according to four GOP sources familiar with the matter. Johnson and Trump spoke again by phone on Thursday, according to Norquist as well as a GOP source familiar with the call. Senate Majority Leader John Thune, R-S.D., said Friday that Republicans are 'all about lowering taxes.' 'I don't want to see taxes go up on anyone. … But the president, he's not a conventional president. People didn't vote for a conventional president, and I think his policies reflect that,' Thune said on CNBC's "Squawk Box." 'This all starts in the House of Representatives, they're going to have to figure out how to dial this.' There's also some confusion among Republicans about how serious Trump is about a plan to raise taxes on the wealthy. Two weeks ago, Trump had publicly shot down the idea of a tax increase on millionaires. Members of the Trump administration also sent conflicting signals on Friday. White House press secretary Karoline Leavitt said at a Friday briefing that Trump would personally not mind paying more money to 'help the poor and middle class and the working class,' but said 'these negotiations are ongoing on Capitol Hill.' Meanwhile, National Economic Council Director Kevin Hassett said Friday on CNBC that Trump's 'not thrilled' about a tax hike for the rich and said 'it's not high on the president's list.' The White House did not respond to a request for further comment. Johnson's office also did not respond to a request for comment. The issue has emerged as a major flashpoint for the GOP, both in terms of the fate of their 'big, beautiful bill' and the direction of the broader party, which has trended more working class under Trump. That's led some Republicans, like former White House adviser Steve Bannon, to argue that a tax hike on the wealthy, while a significant break from traditional party orthodoxy, would be in line with Trump's populist approach. Sen. Josh Hawley, R-Mo., said this week he supports raising taxes on high-income earners to offset spending in the package for Trump's agenda, but noted a majority of his party 'probably don't feel the same.' 'Maybe one or two, but I don't think so,' said Hawley, who has tried to position himself as a champion of the working class. Ryan Ellis, a longtime tax policy adviser to conservatives, said the appetite for higher taxes on the wealthy isn't there among Republicans, and predicted they would 'absolutely' defy Trump if he tried to pursue it. 'This is a Republican mortal sin. It would be like asking a [Democrat] to deny that climate change exists or something,' Ellis said. House Republicans are racing to pass their bill by Memorial Day, meaning they are running out of time to make major decisions. Trump's evolving position on the tax portion of the bill is just one of the issues plaguing GOP leaders on the Hill. Johnson is also caught in a power struggle between moderates and conservatives on Medicaid cuts, while contending with a small group of Republicans from blue states who could torpedo the entire effort over the state and local tax deduction. The House Ways and Means Committee, tasked with extending Trump's 2017 tax cuts, is aiming to mark up their portion of the bill next week. Rep. Jason Smith, R-Mo., the chair of the committee, was expected to meet with Trump at the White House on Friday afternoon, according to a GOP source familiar with the matter. This article was originally published on
NBC News
09-05-2025
- Business
- NBC News
Trump's float of a tax hike for the wealthy quickly runs into GOP resistance
President Donald Trump's last-minute push to raise taxes on the wealthiest Americans is running into a buzzsaw of opposition in the Republican Party, where such proposals have long been anathema. As congressional Republicans assemble a massive tax-and-spending-cut package to deliver on Trump's domestic policy agenda, the White House has been kicking around the idea of allowing the tax rate on top earners to go up as a way to pay for other priorities on taxes, immigration and the military without cutting programs like Medicaid that millions rely on. Trump — who has sent mixed signals on the matter over the past few weeks — floated the idea of bumping the top rate for those making at least $2.5 million annually from 37% to 39.6% during a phone call with House Speaker Mike Johnson, R-La., on Wednesday, as NBC News previously reported. But the proposal received swift pushback from Republicans behind the scenes, raising doubts about whether it will appear in the package, though a draft has still not been finalized. In a Truth Social post on Friday, Trump said that he would 'graciously accept' a ''TINY' tax increase for the RICH,' while also warning of potential attacks from Democrats. He said Republicans should 'probably not do it' but that he would be 'OK' if they did. Grover Norquist, the president of Americans for Tax Reform, told NBC News that Trump called him on Wednesday to seek his input on a tax hike for top earners. Norquist said he pushed back hard on the proposal, citing both economic and political reasons. 'I gave him my sense of why I thought any discussion of increasing rates was a bad idea: because it would kill jobs, it is damaging to small businesses, nobody in the campaign ever discussed this as an option,' Norquist said. 'The other part is, the entire Republican Party is against it.' Norquist said Trump sounded receptive to his argument, and that the president even raised the example of how President George H.W. Bush suffered politically for backtracking on his infamous 1988 campaign pledge, 'Read my lips: no new taxes.' Trump also referenced Bush's pledge in his Friday Truth Social post. The idea of a tax rate increase also did not go over well with Republicans on Capitol Hill, although they entertained the idea following Trump's call with Johnson on Wednesday. House and Senate GOP leadership — which has long been resistant toward raising the top tax rate — communicated to lawmakers and aides by Thursday evening that there aren't enough votes for a tax hike on the wealthy, according to four GOP sources familiar with the matter. Johnson and Trump spoke again by phone on Thursday, according to Norquist as well as a GOP source familiar with the call. Senate Majority Leader John Thune, R-S.D., said Friday that Republicans are 'all about lowering taxes.' 'I don't want to see taxes go up on anyone. … But the president, he's not a conventional president. People didn't vote for a conventional president, and I think his policies reflect that,' Thune said on CNBC's Squawk Box. 'This all starts in the House of Representatives, they're going to have to figure out how to dial this.' There's also some confusion among Republicans about how serious Trump is about a plan to raise taxes on the wealthy. In addition to his ambiguous social media post on Friday, Trump had publicly shot down the idea of a tax increase on millionaires two weeks ago. Members of the Trump administration also sent conflicting signals on Friday. White House press secretary Karoline Leavitt said at a Friday press briefing that Trump would personally not mind paying more money to 'help the poor and middle class and the working class,' but said 'these negotiations are ongoing on Capitol Hill.' Meanwhile, National Economic Council Director Kevin Hassett said Friday on CNBC that Trump's 'not thrilled' about a tax hike for the rich and said 'it's not high on the president's list.' The White House did not respond to a request for further comment. Johnson's office also did not respond to a request for comment. The issue has emerged as a major flashpoint for the GOP, both in terms of the fate of their 'big, beautiful bill' and the direction of the broader party, which has trended more working-class under Trump. That's led some Republicans, like former White House adviser Steve Bannon, to argue that a tax hike on the wealthy, while a significant break from traditional party orthodoxy, would be in line with Trump's populist approach. Sen. Josh Hawley, R-Mo., said this week he supports raising taxes on high-income earners to offset spending in the package for Trump's agenda, but noted a majority of his party 'probably don't feel the same.' 'Maybe one or two, but I don't think so,' said Hawley, who has tried to position himself as a champion of the working class. Ryan Ellis, a longtime tax policy adviser to conservatives, said the appetite for higher taxes on the wealthy isn't there among Republicans, and predicted they would 'absolutely' defy Trump if he tried to pursue it. 'This is a Republican mortal sin. It would be like asking a [Democrat] to deny that climate change exists or something,' Ellis said. House Republicans are racing to pass their bill by Memorial Day, meaning they are running out of time to make major decisions. Trump's evolving position on the tax portion of the bill is just one of the issues plaguing GOP leaders on the Hill. Johnson is also caught in a power struggle between moderates and conservatives on Medicaid cuts, while contending with a small group of Republicans from blue states who could torpedo the entire effort over the state and local tax deduction. The House Ways and Means Committee, tasked with extending Trump's 2017 tax cuts, is aiming to mark up their portion of the bill next week. Rep. Jason Smith, R-Mo., the chair of the committee, was expected to meet with Trump at the White House Friday afternoon, according to a GOP source familiar with the matter.
Yahoo
28-04-2025
- Business
- Yahoo
Trump's flirtation with millionaire tax increase gets strong pushback from the right
President Trump is getting heat from his right flank for declaring he loves the concept of a millionaires' tax increase even though he says he knows it would be used against him politically. Trump made the declaration in an interview with Time magazine and then quickly distanced himself from the proposal to raise the marginal tax rate for people earning more than 1 million dollars per year. But the president's warm embrace of 'the concept' of raising taxes on millionaires is causing an uproar among traditional conservatives and business groups even while some Trump allies on Capitol Hill say they're open to it as long as Trump is on board. Grover Norquist, president of Americans for Tax Reform, a prominent conservative leader, said Senate and House Republicans have been telling Trump 'this is a really bad idea.' 'This idea is dead,' he declared. 'It ain't happening.' Norquist said that while Trump may have said he loves the concept of raising taxes on the wealthy, he's come to his senses and realizes that doing so would be 'political death' as it was for former President George H.W. Bush, who lost his 1992 reelection after breaking his pledge, 'Read my lips: No new taxes.' 'This is the dumbest idea that I've ever heard,' Norquist said. 'It's never going to be in the reconciliation package,' referring to the budget bill that will be used to enact Trump's legislative agenda. Norquist said Trump is on the record repeatedly saying he would support tax cuts for all Americans, the wealthy included, a position strongly supported by the overwhelming majority of GOP senators. 'Do you know how many times he's on video saying we're going to have a tax cut for every single American, upper class, middle class?' he said. 'And how many times on tape he vilified Kamala Harris' for wanting to raise taxes on upper-income Americans and small businesses? Yet Trump appeared to pivot on the issue when asked by Time about 'some Republicans' who are 'considering raising taxes on millionaires.' 'I certainly don't mind having a tax increase, and the only reason I wouldn't support it is because I saw Bush where they said, where he said, 'Read my lips,' and he lost an election,' Trump told the magazine. Trump dismissed the argument that he would be raising taxes if he increased the tax rate on the wealthy to give more tax relief to the millions of working-class Americans who voted for him. 'I'd be raising them on wealthy to take care of middle class. And that's — I love, that. I actually love the concept, 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,' he said. A Republican strategist and former senior congressional aide said Trump's comments sparked alarm on the right. 'The more institutional conservative groups are losing their minds, but I have also talked to a number of conservative House members who are not opposed to it and in fact would be fine with it as long as it's paired with House-level spending cuts and Medicaid reform. They're willing to do it,' the strategist said. Trump made his comments to Time in an interview Tuesday but then backpedaled when asked about the idea Wednesday. 'I think it would be very disruptive, because a lot of the millionaires would leave the country,' he said. 'Now with transportation so quick and so easy, [people] leave countries. You lose a lot of money if you do that.' The idea appears to have some traction in the more populist House, where conservatives led by Rep. Chip Roy (R-Texas) and other fiscal hawks are warning they won't support a new tax relief and spending package that blows up future federal deficits. Senate Republicans are warning that the budget reconciliation package to secure the borders, expand domestic energy production, increase defense spending and extend the 2017 tax cuts won't pass if it raises the tax rate on the top income bracket or creates a new tax bracket for people earning more than 1 million dollars annually. 'That idea is going to go over like a shot dog,' a Senate Republican aide said. 'I can count on one hand the number of Republicans who would support raising the rate on top earners, because you're slamming a lot of small-businessmen who have significant wage income. 'That's not healthy for the economy, particularly because we're going to be going into a slowdown because of Trump's trade policies,' said the source. Richard Stern, the Director of the Grover M. Hermann Center for the Federal Budget at The Heritage Foundation, a leading conservative think tank, said Sunday that a higher top tax rate would be 'counterproductive' and discourage entrepreneurship. 'The Heritage Foundation believes in limited taxes, and we oppose efforts to raise federal tax rates to or beyond 40%. Congress needs to get its fiscal house in order, but it must do so by tightening its own belt, not by forcing American taxpayers to tighten theirs,' he said in a statement to The Hill. 'A higher top tax rate would be counterproductive, discouraging hard work and entrepreneurship. Punishing those who provide for others and create jobs is a recipe for failure,' he warned. So far, a few Republican senators said they would be open to raising the tax rate on the rich if it helps pay for more tax relief for working-class Americans, but many more are opposed and staying quiet for now. Sen. Kevin Cramer (R-N.D.) said earlier this month that there had been talk of higher tax rates for the wealthy during conference lunch meetings, describing the conversation as 'interesting.' But Cramer in an interview last week on Fox Business noted the wealthy already pay a huge chunk of the federal budget. 'The top 1 percent of earners in this country pay 46 percent of the income taxes. That's a pretty significant number. I don't know that you want to disincentivize that kind of behavior. 'It's not our system,' he said. 'I think we had a good formula in 2017,' he continued, referring to the Tax Cuts and Jobs Act, which cut the top income tax rate to from 39.6 percent to 37 percent. Sen. Josh Hawley (R-Mo.) told The New York Times this month that he would be open to raising some taxes on the wealthy to pay for more tax relief for middle- and working-class Americans, as long as the president is on board. 'I think we need to cut taxes for working folks, so if the president wants to offset that, then I'm definitely open to it,' Hawley told the Times. 'I would go so far as to argue that's the core of his base. So we need to do something for those folks.' Sen. Thom Tillis (R-N.C.), who faces a tough reelection race next year, said he's also 'open' to increasing the tax rate on the wealthiest earners if it's carefully crafted to avoid hitting small-business owners. But other Senate Republicans are slamming the door on the idea. 'I am strongly opposed to raising taxes,' Sen. Ted Cruz (R-Texas) said right before the Easter recess. More than 90 trade associations wrote a letter to Senate Finance Committee Chair Mike Crapo (R-Idaho) and House Ways and Means Committee Chair Jason Smith (R-Mo.) urging them to 'stand strong and oppose any effort to increase income tax rates.' The letter, organized by the S Corporation Association, warned that raising the rate on the top income tax bracket would 'disproportionately' hit small businesses. 'This idea is presented as a modest adjustment affecting only the wealthiest Americans, but it would disproportionately harm hundreds of thousands of pass-through businesses organized as S corporations, partnerships and sole proprietorships,' the groups wrote. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
