President Donald Trump is considering a small tax increase for wealthy Americans to help pay for his priorities to boost the middle and working classes.
A source familiar with Trump’s thinking told Fox News Digital that Trump is considering allowing the rate on individuals making $2.5 million or more to increase by 2.6%, from 37% to 39.6%.
He quietly pushed Speaker Mike Johnson, R-La., on the idea in a phone call on Wednesday, two people familiar with conversations told Fox News Digital.
It comes as Republicans work on a massive piece of legislation advancing Trump’s priorities on taxes, border security, immigration, energy, defense and the national debt, which the president has dubbed his ‘big, beautiful bill.’
Differing projections show the bill is likely to add trillions of dollars to the country’s deficit over the next 10 years, so fiscal hawks are looking for ways to mitigate that and set up America for a less bloated government down the line by pairing the new priorities with deep spending cuts elsewhere.
The tax portion of the bill is expected to be the costliest portion.
Republicans are hoping to extend the 2017 Tax Cuts and Jobs Act (TCJA) as well as pay for newer Trump priorities like eliminating taxes on tips, overtime wages and retirees’ Social Security.
TCJA previously lowered taxes for the highest bracket from 39.6% to 37%, but that’s set to expire at the end of 2025. Trump wants to restore that top bracket, albeit for people making significantly more money than the current threshold. The current top tax bracket is $609,350 for single income earners.
The source familiar with Trump’s thinking said doing so would help pay for his ‘massive’ tax cuts for the middle and working classes, as well as protect Medicaid coverage for millions of Americans.
Punchbowl News first reported details of the Trump-Johnson phone call.
It’s not clear yet what Republicans will decide, or even if they will ultimately decide to raise taxes on the highest earners – but details are expected to emerge in the coming days.
The Ways & Means Committee, the House’s tax-writing panel, is expected to meet on Tuesday afternoon to advance that portion of Trump’s bill.
Talks about potential tax hikes on the wealthy have triggered a deep rift within the Republican Party.
Mainstream conservatives have balked at discussions of raising rates on anyone, arguing it would have a negative impact on job creators, while populist and more moderate Republicans have floated such ideas in order to pay for Trump’s priorities to benefit the middle and working classes.
‘Raising taxes on America’s highest earners and biggest job creators makes no sense,’ Marc Short, a former chief of staff to ex-Vice President Mike Pence and a key part of TCJA negotiations, told Fox News Digital.
‘I don’t understand why there are some inside the current administration who are pushing Congress to raise the top rate, because again, these are America’s job creators.’
Other Republicans told Fox News Digital in recent weeks that they believe the idea could be popular, however.
‘I’m open-minded to what the president or the treasury secretary may have in mind. And I would want to see some numbers behind it and how it would have an effect on the economy,’ conservative Rep. Marlin Stutzman, R-Ind., told Fox News Digital in late April.
‘What I’ve heard from people in the upper tax brackets is, you know, they’re willing to pay more as long as they know that it’s paying the debt down. They don’t want to see it go toward more spending.’
Fox News Digital reached out to the White House and Johnson’s office for comment.