Donald Trump can’t believe it. GOP lawmakers have just done what no one thought they would do.
And House Republicans have made a massive legislative announcement that left Trump flabbergasted.
House GOP Unveils Sweeping Tax Reform to Power Trump’s Economic Plan</h3
House Republicans have introduced an ambitious tax reform package, laying the groundwork for President Donald Trump’s economic vision. The Ways and Means Committee unveiled almost 400 pages of legislation on Monday, designed to permanently extend the 2017 Tax Cuts and Jobs Act (TCJA) while rolling out fresh policies to support workers, expand opportunity, and bolster the economy for everyday Americans.
“This bill delivers on what Americans voted for with President Trump’s promise to put America First – with tax policies that reward hard work, bring jobs back home, increase opportunity, and rebuild the economy for the working class,” said Committee Chairman Jason Smith, R-Mo., in a statement.
Tax Relief for Workers and Seniors
The legislation offers significant tax relief for working families and seniors. New deductions eliminate taxes on tipped wages and overtime earnings, providing direct benefits to service workers and those logging extra hours.
For seniors, a temporary increase in the standard tax deduction, effective retroactively from last year through early 2029, fulfills Trump’s commitment to reduce taxes on Social Security benefits. The plan also raises the maximum child tax credit from $2,000 to $2,500, offering greater support for families, and includes enhanced tax breaks for small business owners filing under individual income tax brackets.
Addressing High-Cost Regions
To ease the tax burden in high-cost regions like suburban New York and Los Angeles, the state and local tax (SALT) deduction cap rises from $10,000 to $30,000 for single filers and married couples, with a $15,000 cap for those filing separately.
This increase phases out for incomes above $400,000, reverting to $10,000 for those earning $500,000 or more. While some Republicans argue the cap remains insufficient, others, like Rep. Nicole Malliotakis, R-N.Y., have expressed willingness to support the compromise.
Funding the Plan with Smart Savings
To fund these initiatives and address the nation’s $36 trillion debt, Republicans propose creative cost-saving measures. Artificial intelligence will detect improper Medicare payments, saving billions. Tax-exempt status will be revoked for organizations linked to terrorism.
Tax breaks for professional sports team owners will be curtailed by limiting amortization write-offs. Additionally, large private universities, such as Harvard and Yale, will face higher excise taxes on investment earnings, rising from 1.4% to as much as 21%. The plan also raises the debt ceiling by $4 trillion, a priority Trump emphasized to prevent a potential default this summer.
Scrapping the Millionaires’ Tax Hike
A previously considered proposal to raise the top tax rate to 39.6% for incomes above $2.5 million was abandoned following opposition from conservative groups like Americans for Prosperity and Heritage Foundation, as well as influential Republicans, including former Speaker Newt Gingrich and ex-Vice President Mike Pence. Sources confirmed to Fox News Digital that the idea was dropped before the bill’s committee markup on Tuesday.
Fast-Tracking Trump’s Agenda
The tax package forms a key component of Trump’s “big, beautiful bill,” which Republicans aim to pass through budget reconciliation. This process lowers the Senate’s approval threshold to 51 votes, enabling the GOP to sidestep Democratic resistance and advance priorities on taxes, immigration, energy, and defense.
At the time of writing, the Ways and Means Committee is poised to advance the legislation Tuesday afternoon, marking a pivotal step toward realizing Trump’s economic agenda. With a commitment to secure $1.5 trillion to $2 trillion in savings, House Republicans are balancing tax relief with fiscal responsibility to deliver for working families and strengthen the nation’s financial future.
Stay tuned to The Federalist Wire.
