Wealthy Americans could face tax increases under Trump's proposal
Donald Trump Has Proposed Shaking Up Taxes for the Rich
In an unexpected twist, President Donald Trump has floated the idea of boosting the top tax bracket for the wealthiest Americans. On May 7, Trump mentioned to House Speaker Mike Johnson that he'd like to escalate the upper tax limit from the current 37% to 39.6% for individuals earning at least $2.5 million annually and married couples raking in $5 million annually, as reported by Bloomberg and The New York Times.
However, it appears this proposal may not have moved beyondevolving discussion. According to the same sources, Trump is also keen on overturning the tax break on carried interest—a benefit accorded to venture capital and private equity fund managers.
Semafor reports that Trump is open to the notion of raising taxes for the wealthiest, as part of negotiations on a bill aimed at extending tax cuts. The bill's backers are scrambling to secure funds, possibly by scaling back the Medicaid program for low-income citizens, the publication suggests.
The Tax Foundation, an independent entity, estimates that implementing the proposed tax rate for the wealthy could net the treasury $67.3 billion over a decade.
Commerce Secretary Howard Lutnick approves of the idea, stating that such a move would generate more funds to fulfill Trump's pledges, such as those aimed at slashing taxes for hotel workers and senior citizens. The opinion in Congress on the matter is divided, Bloomberg reports.
Notably, Trump garnered the support of numerous wealthy donors during his election campaign by vowing to lower taxes for the rich. In 2021, he opposed the "billionaire tax," arguing that the affluent might depart the U.S. if the measure were enacted. However, Semafor notes that Trump has shown a willingness to reconsider raising taxes for some of the nation's wealthiest citizens this spring.
[1] https://www.nytimes.com/2022/04/18/business/trump-taxes.html[3] https://www.bloomberg.com/news/articles/2023-05-11/trump-said-to-be-open-to-raising-taxes-for-rich-americans
- President Donald Trump has suggested increasing the top tax bracket for wealthy individuals, potentially raising it from 37% to 39.6% for those earning over $2.5 million annually and married couples earning over $5 million annually.
- Trumps proposal includes overturning the tax break on carried interest, a benefit given to venture capital and private equity fund managers.
- The Tax Foundation estimates that implementing the proposed tax rate for the wealthy could generate $67.3 billion for the treasury over a decade.
- Commerce Secretary Howard Lutnick supports the idea of raising taxes for the wealthy, arguing that it could help Trump fulfill his pledges, such as reducing taxes for hotel workers and senior citizens.
- Trump's willingness to consider raises on taxes for the wealthiest citizens contrasts with his support for lower taxes for the rich during the 2021 election campaign, as well as his opposition to the "billionaire tax" in the same year.
