In the latest political conversations surrounding tax policy, an unexpected voice has hinted at supporting a tax hike on the wealthy: former President Donald Trump. While typically seen as an advocate for tax cuts, Trump recently said he “loves the concept” of raising taxes on millionaires even if, politically, it may be a hard sell.
What’s on the Table?
The idea being discussed is raising the top income tax rate from 37% to 39.6% for individuals earning over $1 million annually. This would effectively roll back part of the 2017 tax cuts and return to the rates seen before Trump’s first term.
Some Republicans are proposing this hike to help fund new tax breaks, such as eliminating taxes on tips, overtime wages, and Social Security income, changes that would primarily benefit middle- and lower-income Americans.
Trump’s view is nuanced:
He supports the principle of the wealthy contributing a bit more.
He fears the political fallout, worrying that opponents could spin it as a betrayal of his tax-cutting image.
He warns it could be “disruptive”, claiming some millionaires might leave the country in response.
Would Millionaires Really Leave?
Trump raised concerns that higher taxes could push millionaires to move abroad. While it’s true that some ultra-wealthy individuals could relocate, the U.S. tax system makes it very difficult to simply leave to avoid taxes:
Exit Tax: If someone renounces U.S. citizenship, they are hit with an expatriation tax- a hefty levy on their worldwide assets.
Ongoing Tax Obligations: Even after renouncing, income earned from U.S. sources is still taxable.
So in reality, fleeing abroad to escape taxes isn’t as easy or as common as it may seem.
Why Raising Taxes on Millionaires Could Actually Help
Raising the top tax rate can have real, measurable benefits:
1. Reducing the National Debt
Higher taxes on the wealthiest Americans would bring in billions of dollars in additional revenue. That could:
Help offset the cost of new tax cuts for the middle class.
Slow the growth of the national debt, reducing future financial pressure on the economy.
2. Funding Middle-Class Tax Relief
Trump’s proposals to eliminate taxes on tips and overtime would especially benefit hourly workers and those in the service industry, groups that often live paycheck to paycheck. Funding these initiatives responsibly is important.
3. Economic Stability
Historically, moderate increases in top tax rates have not hurt economic growth. In fact, when the wealthy contribute more fairly, it can lead to greater economic stability and broader prosperity.
Will It Happen?
While Trump’s comments open the door to a real conversation, many Republicans remain resistant to any tax hikes, even on the wealthy. The political risk is high, and some in the GOP see it as a break from traditional party ideology.
Still, the fact that this idea is even being considered shows a shift: policymakers are looking for realistic ways to balance ambitious tax reforms with fiscal responsibility.
Final Thoughts
By asking millionaires to pay a little more, you’re not punishing success, you’re strengthening the economy, reducing the burden on everyday Americans, and securing a healthier financial future for the nation.
Whether this idea gains traction remains to be seen. But for now, it’s clear: the conversation around fair taxation and national priorities is far from over, and millionaires, like everyone else, have a role to play.
