President Donald Trump has said he is considering a “major tax cut” for middle-income earners that he may announce just days before crucial midterm elections that will determine control of Congress.
The president did not provide any details on the proposal, which would follow a landmark tax overhaul last year that Republicans had hoped would ensure they’d keep control of Congress after the midterms.
The overhaul, which has been criticised for mainly benefiting the wealthy and corporations, hasn’t helped GOP candidates as much as Republicans thought it would. Many forecasters believe Democrats are likely to take the House.
“We’re looking at a major tax cut for middle income people,” the president told reporters on Saturday after a rally in Elko, Nevada – part of a three-state swing through the West to bolster support for Republican House, Senate and gubernatorial candidates. “Not for business at all; for middle-income people.”
Trump’s tax overhaul has also been faulted for adding significantly to the government’s budget deficit. It is possible that a second round of tax cuts could even face resistance from some Republicans concerned about increasing the deficit even more.
No Democrats supported last year’s tax Bill, and they have been critical of plans for second round of tax cuts since they were first discussed by Republicans. Unless offset by spending reductions, any new tax cut would add to the deficit, which reached US$779 (S$1 trillion) in Trump’s first full year in office.
Trump said Representative Kevin Brady, chairman of the House Ways and Means Committee, and House Speaker Paul Ryan are working on the possible legislation. He added that the plan could be announced as soon as the Nov 1 Elections that will decide the control of Congress will be held on Nov 6.
“There is continued interest in building on the success of the Tax Cuts and Jobs Act and constantly improving the tax code for hardworking families and America’s small businesses,” said Rob Damschen, a spokesman for Brady.
The Republican-led House passed legislation last month that would make permanent the 2017 tax cuts for individuals and pass-through businesses which otherwise would expire at the end of 2025.