President Donald Trump wants to do more than just extend the income and corporate tax cuts he passed in 2017, known as the Tax Cuts and Jobs Act — he wants to make good on campaign promises to eliminate taxes on various forms of spending and earning. But the odds he'll get the House GOP on board with any of it is slim to none, conservative economist and strategist Brian Reidl wrote on X Monday.
Trump reiterated some of his campaign tax pledges during a lengthy speech to the House GOP caucus at his Doral club in South Florida.
"Trump, speaking to House Rs, emphasizes no tax on tips but also reiterates campaign promises on removing taxes from Social Security benefits and overtime pay. 'We’re working very hard to get them done,'" reported tax analyst Richard Rubin for the Wall Street Journal.
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Reidl, however, offered a reality check.
"Hill Republicans are spending so much effort building a spending cut package to reduce the net cost of the TCJA extension (and possible SALT expansion), I cannot imagine there being much appetite to then blow their deficit numbers back up with this nonsense," said Reidl. "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."
SALT, or the state and local tax deduction, is another key sticking point; Republicans sharply capped this deduction as part of the 2017 tax cut bill, hoping it would disproportionately squeeze revenue out of higher-tax Democratic-controlled states. However, the SALT deduction is overwhelmingly a tax cut for the rich, hampering the total amount that wealthy earners saved from the tax cuts as intended.
Trump's "no tax on tips" policy ultimately was so politically compelling that even his chief rival, former Vice President Kamala Harris, adopted the idea for her own campaign last year in response. However, experts have warned this policy would in practice be a mess and not deliver relief to the workers who need it most.