Trump Tells Republicans to Cut Taxes for the Rich, Like Trump
President Donald Trump pushed Republicans on Monday to cut taxes on the rich by using money that’s slated to help lower-income Americans purchase health insurance.
I am proud of the Rep. House & Senate for working so hard on cutting taxes {& reform.} We’re getting close! Now, how about ending the unfair & highly unpopular Indiv Mandate in OCare & reducing taxes even further? Cut top rate to 35% w/all of the rest going to middle income cuts?
— Donald J. Trump (@realDonaldTrump) November 13, 2017
Trump’s request, which the president relayed by Twitter from his trip through Asia, comes at a sensitive moment in tax negotiations. It also goes against his repeated insistence that tax legislation should be focused on providing middle-class tax relief rather than cutting taxes for wealthy filers like himself.
At times, the president has even predicted that he would pay more under a GOP plan (Trump has not released his tax returns, but multiple provisions in the House and Senate bills appear likely to benefit his business and family).
The House and Senate have released competing bills, neither of which ends the individual Obamacare mandate to maintain insurance coverage or lowers the top rate nearly as far as the president requested on Monday.
In the case of the House bill, the top rate would stay at the current 39.6 percent but would apply it to a higher income threshold: For married couples, it would only kick in after the first $1,000,000 in income versus $470,000 now.
The Senate bill would lower the top rate to 38.5 percent and also have a $1,000,000 threshold for married filers.
Republicans have weighed repealing the individual mandate in recent weeks, which the Congressional Budget Office estimates would free up $338 billion over 10 years for tax reform.
But the savings occur only because CBO predicts 13 million fewer people would have health insurance by 2027. It’s not clear whether that’s enough to reduce top rates to Trump’s desired levels or provide additional middle-class benefits.
In general, rich households already do well in analyses of the current tax plans thanks to provisions like ending the alternative minimum tax, reducing or repealing the estate tax, and cutting taxes for pass-through entities, all of which could potentially benefit Trump himself.
Under the new Senate bill, for example, the conservative Tax Foundation estimates the top 1 percent of taxpayers would see a 7.5 percent increase in after-tax income, versus less than 2 percent for the bottom 80 percent.
Democrats, who have spent weeks attacking the Republican tax bills as a boon to the rich, quickly seized on Trump’s remarks.
“Sooner or later, President Trump’s core supporters will realize that he’s selling them out,” Minority Leader Chuck Schumer, D-N.Y., said in a statement. “This proposal would send premiums for millions of Americans skyrocketing, all so that the wealthy can get an even bigger tax giveaway than they’d get under the original Republican plan.”
[NBC News]