White House Chief Strategist Steve Bannon is reportedly upending traditional right/left divides on tax policy and pushing for a populist tax reform.
Bannon’s plan would cut taxes on the middle classes but impose a new 44 percent top tax rate for the very rich — and it’s an idea that seems to have caught President Trump’s imagination.
The current top tax rate is 39.6 percent and any Republican tax plan originating from the GOP House leadership would likely include deep tax cuts across the board, including for the very rich. A plan introduced by Treasury Secretary Steven Mnuchin and National Economic Director Gary Cohn in April had the top rate dropping to 35 percent.
But the Intercept reports that Bannon is eyeing a 44 percent top marginal rate that would be placed on those earning more than $5 million a year — allowing the increased revenue to counterbalance the revenue loss that would come from cutting taxes for lower earners.
It isn’t the first time such a plan has been floated. Earlier this month, Axios reported that Bannon, who was executive chairman of Breitbart News before joining the Trump campaign, wants the top income tax bracket to “have a 4 in front of it.”
The plan would be a typically populist move — a conservative policy in cutting taxes, but one that focuses more on benefitting the middle-class than those at the top of the pile. It could also be surprisingly bipartisan, giving Republicans the tax cuts they seek while not offending Democrats with a tax cut for the very rich.
Trump appears to have warmed to that kind of plan, and this week publicly supported the idea in theory.
“The people I care most about are the middle-income people in this country, who have gotten screwed,” Trump told the Wall Street Journal. “And if there’s upward revision it’s going to be on high-income people.”
“I have wealthy friends that say to me, ‘I don’t mind paying more tax,’” he said, before adding that “we have to take care of middle-income people in this country. They built the country. They started this whole beautiful thing that we have. And we have to take care of them. And people have not taken care of them, and we’re going to.”
Adam Shaw is a Breitbart News politics reporter based in New York. Follow Adam on Twitter: @AdamShawNY
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