In a move that could signal a shift in Republican tax policy, the Trump administration is weighing an increase in the top income tax rate for the wealthiest Americans as a means to fund tax cuts on tipped income. A senior White House official confirmed the discussions to Axios, noting that the plan remains in its early stages. The proposal, if implemented, would mark a departure from traditional GOP economic strategy, which has long prioritized across-the-board tax cuts. White House officials argue that raising the top income tax rate could provide the necessary revenue to eliminate taxes on tips, a move aimed at benefiting millions of service industry workers. Currently, the top federal income tax rate stands at 37%, applying to earnings above $609,351 for individuals and $731,201 for married couples. If the 2017 tax cuts expire, this rate would revert to the pre-2018 level of 39.6%. The increase would primarily impact the highest-earning 1% of taxpayers, who already shoulder a huge portion of federal income tax revenue. By accepting a tax hike for top earners, the administration could utilize budget reconciliation rules to offset the cost of cutting taxes on tips, aligning with Trump’s populist messaging that seeks to position Republicans as champions of the working class. The move is also seen as an effort to neutralize Democratic criticisms that Republican tax policies disproportionately benefit the wealthy. With growing concern over the national deficit and looming budget battles, some White House officials believe that a limited tax increase on high earners could provide political leverage while still maintaining the party’s broader commitment to tax cuts. “If we renew tax cuts for the rich paid for by throwing people off Medicaid, we’re gonna get slaughtered,” a senior administration official told Axios. Polling data suggests that a majority of Americans—including a significant portion of Republican voters—support increasing taxes on the wealthiest individuals and corporations. A recent Pew Research survey found strong bipartisan backing for tax hikes on high-income earners to address economic disparities. Despite the potential benefits, the proposal faces stiff opposition within the Republican Party. Many GOP lawmakers and donors view tax cuts as a cornerstone of conservative economic philosophy, arguing that higher rates on top earners could hinder economic growth and investment. Treasury Secretary Scott Bessent has cautioned against allowing the 2017 tax cuts to lapse, warning that such a move could trigger economic instability. Additionally, many Republican legislators are hesitant to support a policy shift that might be perceived as a departure from the party’s long-standing tax reduction agenda. Historically, Republican presidents have championed lowering top tax rates. Ronald Reagan reduced the highest marginal tax rate from 70% to 28%, while George W. Bush lowered it from 39.6% to 35%. Trump’s 2017 tax reform continued this trend, making the prospect of a rate increase a significant departure from past GOP policies. (YWN World Headquarters – NYC)