On Thursday’s broadcast of Bloomberg’s “Balance of Power,” Commerce Secretary Howard Lutnick responded to a question on reports that President Trump is eyeing raising taxes on the wealthy by saying that “he cut it from 39.6 to 37. So, if he just goes back to what he did last time, I’m in favor of that. I think it’s smart, as long as it is a redistribution to his priorities of no tax on tips, no tax on overtime, and no tax on Social Security.”
Co-host Kailey Leinz asked, “[Y]ou believe this will result in higher revenue for the United States, if we’re going to get all this revenue from tariffs, why would the President be pushing for higher taxes on anybody? Because our understanding is, for the wealthy, he’s looking at a new rate of 39.6%, and I thought the Republican Party didn’t stand for that kind of thing.”
Lutnick responded, “Well, you realize that the tariff revenues [don’t] count toward the reconciliation numbers? Don’t ask why. I can’t understand why. We’re running it like 20, 25 billion a month, and they’re not counting it. But we’ll leave that aside for another day, this is Washington, they have their own accounting practices. So, the President’s trying to make sure he gets no tax on tips, no tax on overtime, and no tax on Social Security. And if he says, look, the richest Americans — remember, he cut it from 39.6 to 37. So, if he just goes back to what he did last time, I’m in favor of that. I think it’s smart, as long as it is a redistribution to his priorities of no tax on tips, no tax on overtime, and no tax on Social Security. I think it’s smart. But what you’ll see next year is you’ll see the revenues from tariffs are so great and our deficit is lower, then you’ve got the gold — the Trump card coming out. And that’s going to raise revenues and drive that lower. And then you’re going to see interest rates lower, you’re going to see the deficit lower. And next year is going to be one happy year.”
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