Trump endorses higher tax bracket for wealthy, complicating tax talks

President Donald Trump is further complicating Republican lawmakers’ path to a party-line tax bill this year by pushing them to create a new, higher tax bracket for upper-income earners.

In a call with House Speaker Mike Johnson on Wednesday, Trump proposed to tax individuals’ income at $2.5 million and above at 39.6%, a source familiar with the discussions told Semafor. The president’s nudge to the GOP Congress comes after weeks of wavering on the idea of raising taxes on higher earners, an idea that undeniably makes it harder for Republican leaders to get a tax bill done by their unofficial July 4 deadline.

In fact, Johnson himself dismissed talk of a rate increase just last month, telling Fox News that he’s “not in favor of raising the tax rates, because our party is the group that stands against that traditionally.”

Senate Finance Chair Mike Crapo, R-Idaho, told conservative radio host Hugh Hewitt on Thursday that he is “not excited about the proposal, but I have to say, there are a number of people in both the House and the Senate who are.

“If the President weighs in in favor of it, then that’s going to be a big factor that we have to take into consideration,” Crapo added.

Part of Trump’s challenge ahead may be education of his fellow Republicans: Even with his proposal to raise the tax rate on higher earners, the still-unfinished GOP bill would amount to a net tax cut for Americans. And Trump has some more populist-leaning allies already in his corner — such as Sen. Josh Hawley, R-Mo.

“Those are people who could afford to pay a little more, and I think it would make a huge difference for working families, for small businesses, to really offer really serious tax relief,” Hawley told Semafor.

“I don’t have any problem with allowing that highest of rates to bump up a little bit, just like the president has proposed,” Hawley added.

Just last month, Trump said he plans to focus tax relief on those making under $200,000, but he first aired support for the idea of a higher tax rate on upper-income earners weeks ago.

“The president is prepared to make a historic deal for all Americans,” a White House official told Semafor.

Punchbowl News first reported Trump’s pitch to Johnson about the new tax bracket.