On February 6, 2025, members of the Trump Administration met with certain U.S. House of Representatives Republican legislators and discussed various tax and budgetary priorities in a private but well-publicized meeting. Subsequently, the House proposed a budget resolution that earmarked up to $4.5 trillion for tax cuts over the next ten years. While the House has yet to elaborate on specific tax cuts or legislation, a widely reported, leaked internal House memorandum, which predated the meeting with the Trump Administration and which is discussed further here, details various tax cuts that align with many of Trump’s tax priorities.
The Trump Administration’s tax priorities discussed during the meeting include various tax proposals that Trump campaigned on, such as:
- Renewing various provisions of the 2017 Tax Cuts and Jobs Act (TCJA), many of which are set to expire at the end of 2025, as discussed further here;
- Eliminating taxes on tips;
- Eliminating taxes on overtime pay;
- Eliminating taxes on seniors’ social security benefit payments;
- Adjusting the $10,000 limit on individual’s state and local tax deductions; and
- Implementing tax cuts for products that are made in America.
Additionally, the Trump Administration proposed two new tax priorities during the meeting:
- Closing the carried interest loophole, as discussed further here; and
- Eliminating tax breaks for billionaire sports team owners.
As an alternative to the House’s resolution, the U.S. Senate proposes a two-step budget approach, which omits tax cuts from their current budget resolution and would include tax cuts in a separate budget resolution later this year. Because the House and Senate must agree to identical budget resolutions in the budget reconciliation process, whether tax cuts will be addressed currently, i.e., the House’s resolution, or later this year, i.e., the Senate’s resolution, remains uncertain.
