Trump, Who Championed Tax Cuts, Pushes for 'Billionaire Tax' on Annual Incomes Over $2.5 Million

Tax Rate Raised from 37% to 39.6%
"Increasing Taxes to Fund Cuts for Workers and the Middle Class"

U.S. President Donald Trump has proposed a tax increase for ultra-high-income earners to the Republican congressional leadership.

On May 8 (local time), Bloomberg and other outlets reported that as the U.S. Congress, led by the Republican Party, was discussing the handling of tax cut legislation, President Trump delivered this proposal to Republican House Speaker Mike Johnson the previous day.

AP Yonhap News

According to sources, President Trump proposed creating a new tax bracket for individuals with annual incomes of $2.5 million or more, or couples with combined incomes of $5 million or more, imposing a tax rate of 39.6%. The current top individual income tax rate is 37%.

President Trump, a former real estate mogul, has consistently argued for large-scale tax cuts. Accordingly, the Republican Party, which holds the majority in both the House and Senate, is pushing in Congress to extend the Trump-era tax cuts set to expire at the end of this year and to pass what is being called a "big, beautiful bill" that includes exemptions for tips and overtime pay.

However, Bloomberg reported that internal disagreements within the Republican Party over issues such as cuts to Medicaid, the health insurance program for low-income individuals, are making it difficult to reach an agreement. In relation to this, a Trump administration official told the online media outlet Axios that "the tax increase for ultra-high-income earners will be used to fund tax cuts promised to the working class and middle class, and will protect Medicaid."

There is also analysis that President Trump is seeking to avoid criticism that "MAGA (Make America Great Again) policies" only benefit the wealthy by imposing taxes on billionaires. Bloomberg pointed out, "A billionaire tax goes against a long-standing Republican principle. This shows President Trump trying to rebrand the Republican Party with a populist image."