Trump is considering cutting federal payroll taxes and more in a bid to win votes
| AP Yonhap News |
Former U.S. President Donald Trump has hinted at considering tax cuts for the middle class if he is re-elected in this year’s presidential election. If realized, it may exacerbate inflation and fiscal deficits.
Reuters reported on the 17th (local time), citing multiple sources, that the former president had recently revealed such a stance to his economic advisory team.
The tax cuts reportedly include lowering the federal payroll tax, raising the standard deduction, and lowering marginal income tax rates. According to the sources, these measures are said to broadly cover the middle class.
Currently, conservative economist Stephen Moore, former director of the White House National Economic Council, and others are known to be participating in the discussion of this tax cut plan.
Former President Trump also pushed for massive tax cuts during his term in 2017 and promised corporate tax cuts in this presidential election campaign.
While this middle-class tax cut plan aims to attract voters before the election, Reuters pointed out that it could worsen the US’ chronic fiscal deficit. Some critics have argued that cutting federal payroll taxes could lead to a shortfall in funding for Social Security and other programs.
The concern is that even if tax cuts spur short-term economic growth, they could fuel inflation in the long run and add to the federal debt, which already stands at $34 trillion.
President Joe Biden, who has announced a return match with former President Trump in this year’s presidential election, is promoting contrasting policies, citing such potential side effects.
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