Donald Trump is promoting unconventional tax breaks on tips and overtime pay, calling them overdue relief for workers. Conservative voices, however, label these moves nonsense, and House GOP members remain focused on renewing the 2017 legislation, casting serious doubt on whether Trump's latest ideas will advance.
To fulfill his campaign pledge to abolish taxes on different types of spending and earning, President Trump would like to do more than simply extend the tax cuts he passed in 2017-the Tax Cuts and Jobs Act-on income and corporations.
It is quite unlikely that he will be able to convince the Republican members of the House of Representatives to support any of his proposals. According to a post that was published on X, Monday, by conservative economist and strategist Brian Reidl.
During a lengthy address that he delivered to the House GOP caucus at his Doral club in South Florida, Trump restated some of the claims that he made during his campaign regarding taxes.
According to Wall Street Journal tax expert Richard Rubin, Trump reiterates campaign pledges to remove taxes on Social Security benefits and overtime pay while addressing House Republicans, while also emphasizing that gratuities are not taxed.
On the other hand, Reidl provided a dose of stark truth.
Reidl mentions that Republicans on Capitol Hill are putting a lot of time and energy into crafting a spending cut package to lower the overall cost of the TCJA extension (and potential SALT expansion). He goes on to say that he finds it hard to believe that they will be willing to blow their deficit figures even more with this foolishness.
"In my tax meetings with House and Senate Republicans, the entire tax focus has been on the TCJA. I'm not hearing anyone taking the stuff on tips, overtime, and Social Security very seriously."
Another major issue is SALT, which stands for "state and local taxes." Republicans severely limited SALT in the 2017 tax cut plan in the hopes that it would unfairly target states with higher taxes and Democratic rule, thus reducing their revenue. On the other hand, the SALT deduction mostly benefits the wealthy and reduces the overall amount that high-income people were able to save due to the tax cuts.
Trump's "no tax on tips" promise was so appealing to voters that even his main opponent, Kamala Harris (D-Calif.), used it in her own campaign last year. Nonetheless, specialists have cautioned that putting this approach into action would result in chaos and fail to assist the workers who are most in need.
