Trump considering corporate tax hike – Washington Examiner
President Donald Trump is contemplating a proposal from some Republicans to increase the corporate tax rate in order to fund a large tax reform package. This potential shift is a departure from his previous position in the 2024 campaign, where he had suggested lowering the corporate tax rate from the current 21%. The corporate tax cuts, part of the 2017 Tax Cuts and Jobs Act (TCJA), are permanent, while individual tax provisions are set to expire without Congressional intervention.
Recent comments from White House press secretary Karoline Leavitt indicated that Trump has not yet made a final decision regarding the corporate tax hike to cover the fiscal burden his tax cuts would impose on the budget. congressional Republicans are currently finalizing legislation that aligns wiht Trump’s key priorities, which include tax reform and federal spending cuts.
There are concerns among fiscal conservatives about the financial implications of extending the TCJA and the potential need for significant spending cuts to balance out the proposed cuts, which could cost between $1.5 trillion and $5.3 trillion over the next decade. Some Republican senators are openly discussing the possibility of raising the corporate tax rate as a means to offset these costs, while further consideration is being given to potential income tax hikes for high earners.
Trump considering corporate tax hike to pay for ‘big, beautiful’ tax reform package
President Donald Trump is considering a proposal put forward by some Republicans to raise the corporate tax rate to offset trillions of dollars in other tax cuts proposed by the White House, which would break from his 2024 campaign platform.
Trump’s 2017 Tax Cuts and Jobs Act extended tax cuts to more than 60% of all American filers and lowered the corporate tax rate from 35% to 21%. The individual provisions included in TCJA will expire at the end of this year without Congressional action. However, the corporate tax amendment was made permanent, and the president repeatedly floated lowering it again to 15% while campaigning last year.
White House press secretary Karoline Leavitt confirmed to the Washington Examiner on Tuesday that Trump has not decided if he supports a corporate tax hike to pay for the trillion-dollar burden his new proposed tax cuts would place on the federal budget.
“Look, I’ve seen this idea proposed. I’ve heard this idea discussed, but I don’t believe the president has made a determination on whether he supports or not,” she said during Tuesday’s press briefing.
After finally approving a budgetary framework last week, congressional Republicans are now trying to finalize legislation that combines the president’s priorities on immigration, slashing federal spending, and reforming the tax code. Senate Republicans have voiced support for addressing the president’s priorities in two separate pieces of legislation, while the president has urged Congress to pass “one big, beautiful bill.”
The nonpartisan Tax Foundation estimated that Trump’s ask, both the TCJA extension and the president’s proposals to eliminate taxes on tips, Social Security, and more, would cost between $1.5 and $5.3 trillion over the next decade.
Fiscal hawks in the House backed off their opposition to the budget resolution last week after securing assurances from Senate Majority Leader John Thune (R-SD), Trump, and House Speaker Mike Johnson (R-LA) to produce significantly more than $1.5 trillion in spending cuts to offset the new tax cuts. Republican leadership maintains that extending TCJA, a commitment of more than $4 trillion, would effectively cost nothing as it simply maintains the status quo of the tax code.
However, Sen. Rick Scott (R-FL), chairman of the National Republican Senatorial Committee and a member of the Senate Committee on Budget, has openly floated raising the corporate tax rate as a deficit offset. His office declined to comment Tuesday afternoon.
Axios reported in March that the president is also considering an income tax increase for the United States’s top earners.
The TCJA individual provisions that Trump hopes Congress can extend expire at the end of 2025. The Tax Foundation estimated that if they expire, 62% of filers will see their taxes increase the following year.
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You can watch Leavitt’s briefing in full below.
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