Scoop: Trump might let taxes rise for the rich to cover breaks on tips

[BumRushDaShow]

Source: Axios

2 hours ago


The Trump administration is discussing a surprising option to help fulfill his campaign-trail promises: Allowing the richest Americans' tax rates to rise in return for cutting taxes on tips, a senior White House official tells Axios.

The big picture: Some White House officials believe letting income taxes on the very highest earners rise would buy breathing room on other priorities, and help blunt Democrats' attacks as they seek to extend President Trump's 2017 tax cuts.

Officials say all discussions are preliminary and nothing is set in stone.

By the numbers: Currently the top income tax rate is 37%, charged on income above $609,351 for an individual or $731,201 for a married couple.

If the 2017 law were allowed to expire, that would jump to the pre-2018 rate of 39.6%, and lower the threshold above which the top rate applies.

Around 1% of taxpayers are in that top bracket, though they pay a disproportionate share of income taxes.

Under the budget reconciliation rules that Republicans seek to use to extend the tax cuts, that would free up more revenue that could be used to fulfill some of Trump's populist promises, such as eliminating taxes on tips.

Zoom out: It would aim to flip the script on Democrats, whose messaging focuses on Republicans potentially slashing Medicaid and enlarging the deficit in order to fund tax cuts for the super-rich.

"If we renew tax cuts for the rich paid for by throwing people off Medicaid, we're gonna get f--king slaughtered," the White House official said.

As the GOP under Trump becomes more of the party of working-class voters, the political risks of raising rich people's taxes are relatively small, compared to the payoff of cutting taxes on tips in the growing service-sector economy.

A majority of Americans, including a plurality of Republicans, support raising taxes on wealthier individuals, polls have shown.

Read more: https://www.axios.com/2025/03/28/trump-taxes-wealthy

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That's not what the billionaires paid tens, if not hundreds of millions on.

[in2herbs]

1. Get into the weeds on this proposition as I've read that "tips" will include the bonuses paid to those on

Wall Street so all they will have to do to get around this seeming tax hike is to assign more of their income as tips.

[rurallib]

5. Thank You! Few would have caught that

[unblock]

2. Not holding my breath on this, but it would be epic if they manage to piss off their one true constituency

[Scrivener7]

3. Nah. He'll back out of this.

[OrlandoDem2]

4. If tips are not taxed I'll start tipping less.

[Grins]

6. Will NEVER happen!

NOT paying taxes is the Raison d'être of the GOP! That and no other.