Trump's shocking shift: Could higher taxes on the rich Be the key to his tax bill?

US President Donald Trump said he is open to a higher tax rate on the rich in order to help workers, as he seeks to advance what he has previously called a "big, beautiful" tax and spending bill through Congress.

Trump on Friday said Democrats would seize on "even a 'TINY' tax increase for the 'RICH,'" citing former Republican President George H.W. Bush, who lost his re-election bid after saying "Read my lips: no new taxes" during his 1988 election campaign.

Trump said the "problem with even a 'TINY' tax increase for the RICH, which I and all others would graciously accept in order to help the lower and middle income workers" is how Democrats would react, citing President George H. W. Bush's infamous "read my lips: no new taxes" comment that would later come back to haunt him.


"Republicans should probably not do it, but I'm OK if they do!!!" Trump posted on his Truth Social platform. Trump has repeatedly rejected raising taxes on the wealthy as a bad strategy because they would leave the country.

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Trump's remarks followed a Reuters report that he had spoken to House Speaker Mike Johnson (R-LA) about raising the rate on individuals making $2.5 million or more to increase by 2.6 percent, to 39.6 percent. They had also discussed closing the carried interest loophole for Wall Street investors, per the report, which cited two sources familiar with the conversations.

The Republican president suggested an increase to 39.6% from 37% for those earning $2.5 million and higher or joint filers earning $5 million, with carve-outs for small businesses, one source said.

Trump to increase taxes on wealth?

The vexing tax issue illustrates the difficulty Republicans face in approving an overall taxing and spending package, what Trump calls "a big, beautiful bill," while facing unified opposition from Democrats.

Republicans in the House and Senate are seeking to extend the 2017 tax cuts enacted during Trump's first term in the White House that are set to expire this year. Trump and Republican lawmakers have cited the potential extension as relief for Americans and an economic boost amid Trump's tariffs on imported goods, and vowed to pass it as part of a larger budget bill this summer.

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So far, Johnson and other top Republicans have resisted higher taxes on the wealthy despite pressure from the Trump's populist MAGA base.

In late April, Trump had spoken against the idea of a millionaire tax that was under discussion among Republicans, who were divided on it.

"I think it would be very disruptive because a lot of the millionaires would leave the country," Trump told reporters in the Oval Office.

"In the old days they left states, they'd go from one state to the other. Now with transportation so quick and so easy, they leave countries."

(With inputs from Reuters)