WASHINGTON — President Donald Trump and House Speaker Mike Johnson, R-La., came out against a tax increase on millionaires, appearing to close the door on an idea that some Republicans have considered to pay for their massive party-line bill.
“I think it would be very disruptive, because a lot of the millionaires would leave the country,” Trump told reporters in the Oval Office when asked about the proposal on Wednesday. “The old days, they left states. They go from one state to the other. Now with transportation so quick and so easy, they leave countries.”
“You’ll lose a lot of money if you do that,” the president added. “And other countries that have done it have lost a lot of people. They lose their wealthy people. That would be bad, because the wealthy people pay the tax.”
The tax rate on the highest earners is set to automatically increase from 37% to 39.6% at the end of this year when major portions of Trump’s tax cuts from 2017 expire. Some Republican lawmakers have said they’re open to letting that top rate increase as a way to limit the deficit impact of their agenda, which includes tax breaks and spending increases on immigration enforcement and the military.
Johnson also threw cold water on the prospect of a tax hike on Americans making over a million dollars annually.
“I would not expect that. We have been working against that idea,” Johnson said Wednesday on Fox News. “I’m not in favor of raising the tax rates because our party is the group that stands against that traditionally. So there are lots of ideas thrown out on the table along this process over the last year, but I would just say for everybody, just wait and see.”
“I don’t think we’re raising taxes on anybody,” he added. “What we’re trying to do is prevent the largest tax increase in U.S. history.”
The idea of a top tax rate hike was put on the table by top Republicans as part of a menu of options to prevent a massive increase in the deficit as a result of a bill to pass Trump’s legislative agenda, which is expected to cost trillions of dollars. Others say a top rate increase would help achieve other Trump priorities, like nixing taxes on tips.
Rejecting the idea is likely to further complicate the task of crafting the legislation in a way that doesn’t balloon the debt. An extension of Trump’s 2017 tax law is projected to cost $4.6 trillion alone, and Republicans are also pushing for hundreds of billions of dollars in new spending.
Rep. Chip Roy, R-Texas, told NBC News in an interview that he’s open to any policies that prevent new deficits, including allowing higher tax rates. He said the expected savings are about $300 billion if the top rate snaps back to 39.6%, and that if Republicans keep the lower rate, they need to offset it with significant spending cuts.
“Morally, I believe taxes should be lower for everybody across the board. We don’t need to be taxing the American people as much as we are,” Roy said. “However, I also need the math to add up.”
The internal GOP debate has been fueled by the party’s coalition. In recent elections, college-educated and wealthier voters have shifted toward the Democrats, while Republicans have made gains among working-class voters without college degrees.
Still, lowering taxes, including on the wealthiest Americans, has long been a pillar of the Republican platform. And plenty of lawmakers and outside allies want to keep it that way.
A Pew Research Center poll released last month found that 58% of U.S. adults said taxes should go up on households making more than $400,000 per year, including 43% of Republicans.
Democrats have zeroed in on the tax extensions for upper-earners as part of their case against the Trump agenda legislation, which Republicans are pursuing on a party-line basis.
“Why haven’t House Republicans done a single thing to lower the high cost of living in America?” House Minority Leader Hakeem Jeffries, D-N.Y., wrote over the weekend on X. “The extremists are too busy trying to take away your healthcare and cut taxes for their super rich donors.”
Garrett Haake and Syedah Asghar contributed.
