U.S. President Donald Trump has reportedly directed the Republican leadership to raise taxes on high-income earners, indicating a fracture in the party's tax cut stance. Lawmakers are pushing back, arguing that the issue is not the lack of tax revenue but excessive expenditure, emphasizing that spending cuts should take priority.
According to the Washington Post (WP) on the 8th (local time), Congress is currently reviewing whether to extend the personal income tax rate cuts under the 2017 "Tax Cuts and Jobs Act." This measure is set to expire at the end of this year.
However, President Trump is reported to have decided on tax increases rather than extending tax cuts. According to reports quoting anonymous sources, President Trump directly instructed increasing taxes on high-income earners during a conversation with House Speaker Mike Johnson of the Republican party.
그런데 트럼프 대통령은 세금 인하 연장이 아닌 세금 인상을 결심한 것으로 전해졌다. WP가 익명의 관계자들을 인용한 보도에 따르면, 트럼프 대통령은 최근 공화당의 마이크 존슨 하원의장과의 대화에서 최고소득자에 대한 세금 인상을 직접 지시한 것으로 전해졌다.
Inside the Trump administration, discussions are reportedly underway about reinstating the highest tax rate to the level during the Barack Obama administration, as well as creating a separate tax bracket for high-income earners earning over $5 million (approximately 7 billion won). Currently, the highest tax rate of 37% applies to individuals with an annual income exceeding $626,350 (approximately 876.27 million won) and couples with a combined income exceeding $751,600 (approximately 1.05163 billion won).
This decision stands in stark contrast to the tax cut policy that President Trump has maintained since his first term and is causing confusion within the Republican party regarding tax reform discussions. Senator Josh Hawley noted, "I do not oppose tax increases on the wealthy," but pointed out that most Republican senators are unlikely to agree, stating, "Probably zero will agree."
House Speaker Mike Johnson, Senate Minority Leader John Thune, and the tax committee lawmakers in both chambers have been preparing for an extension of tax cuts for all income groups. At the same time, they are pursuing Trump's campaign promises, such as income tax exemptions for tips, overtime pay, and social security benefits, as well as allowing tax deductions for loans when purchasing U.S.-made automobiles. However, these promises could lead to a financial burden amounting to approximately $11.95 trillion (approximately 1,672 trillion won) over the next decade, heightening tensions between Trump supporters and fiscal conservatives.
To offset the financial burden of tax cuts, the Republican party is pushing for $2 trillion (approximately 2,798 trillion won) in federal expenditure cuts over the next decade. However, they have stated that they will not include the cost of $550 billion (approximately 769.45 trillion won) associated with the tax cut extension in their calculations.
For this reason, some lawmakers argue that expenditure cuts should take precedence over tax increases. Republican Senator Bernie Moreno stated, "The problem is not tax revenue but expenditure; making the existing tax proposals permanent and exempting income taxes on tips, pension, and overtime is the simplest and most effective approach." Senator Ron Johnson also expressed opposition to tax increases, stating, "Now it is best to maintain the current tax system as it is. We shouldn't add anything new."