US President Trump rejects tax hike for millionaires

While the wealthy sometimes move between states to lower their tax burdens, it is much harder to move abroad

- Richard Rubin

President Trump tossed cold water on the idea of raising tax rates on the highest-income Americans, ending for now a Republican flirtation with higher taxes at the top to help pay for his broader agenda.

He called a potential millionaire's tax "very disruptive" on Wednesday, a day after former House Speaker Newt Gingrich circulated a message from Trump saying the president loves the idea of a small tax increase.

Week's remarks came far short of that, and in large measure, the center of gravity in the party that identifies itself by opposition to tax increases is staying where it was.

"If you've got a Republican Party that has just given up on the tax issue, it's just a massive branding problem," Roskam said.

Republicans typically object to higher tax rates for several reasons, saying they weaken incentives to work and harm investment decisions for business owners who pay their companies' income taxes through their personal tax returns.

But Trump cited a different reason.

Republicans against it for political reasons.

Trump's comments in the Oval Office capped weeks of chatter in GOP circles about letting the 37% marginal income-tax rate climb back to 39.6% or rise to 40% on incomes over $1 million as part of the tax-and-spending bill Congress is considering.

The idea, which cut against long-standing GOP views on taxes, could have countered Democrats' argument that Republicans are simultaneously trying to take money from Medicaid and lower taxes for the richest Americans.