White House chief strategist Steve Bannon has reportedly urged President Donald Trump to raise the highest income tax bracket for the wealthiest Americans, a proposal that conflicts with the views of the GOP establishment. Meanwhile, White House chief economic adviser Gary Cohn and Treasury Secretary Steven Mnuchin are aggressively pursuing a dramatic reduction in the nation's corporate tax rate.
On July 2, several White House officials disclosed that Bannon was pushing the idea of raising taxes on the wealthiest Americans, Axios reports.
Currently, individuals who earn $418,400 or more annually are taxed at 39.6 percent. Bannon is reportedly telling colleagues he would like the highest tax bracket "to have a 4 in front of it."
The chief strategist's plan has reportedly caused controversy within the Trump administration, as fellow aides believe Republican lawmakers would swiftly nix the proposal. Bannon reportedly has asserted that raising taxes for the wealthiest Americans would bolster Trump's populist credentials.
An anonymous senior Trump administration official signaled that Bannon's proposal had already been disregarded.
"We're beyond that," the official told The Weekly Standard.
On April 26, the Trump administration revealed its preliminary tax plan. That proposal included reducing the top income tax bracket from 39.6 percent to 35 percent. The plan also called for Congress to slash the corporate tax rate from 35 percent to 15 percent.
The Trump administration's corporate tax proposal has been met with concern by GOP lawmakers, who caution that such a dramatic reduction would hurt revenues and grow the federal deficit. In November 2016, an analysis by the Tax Policy Center estimated that reducing the corporate tax rate to 15 percent would result in federal revenues shrinking by roughly $2.4 trillion within a decade, according to CNN Money.
Cohn and Mnuchin are reportedly lobbying hard for the corporate tax cut. Both Trump administration officials reportedly believe that corporations would be willing to have their tax loopholes gutted in exchange for a 15 percent tax rate and are allegedly signaling an openness to a tax plan that adds to the federal deficit.
Cohn has reportedly warned colleagues that tax reform must be completed by 2017, concluding that any comprehensive plan would become impossible by the 2018 midterm elections.
On May 17, a Morning Consult/Politico poll found that the majority of Americans wanted both corporations and the wealthy to pay more in taxes.
The poll's findings suggest that 59 percent of national adults believe corporations are not paying enough, while 52 percent believe small businesses are paying too much in taxes. Meanwhile, 62 percent of respondents said that upper-income Americans are not paying enough in taxes, according to Morning Consult.