Donald Trump signs EO on drug pricing
President Donald Trump signs executive order on drug pricing to match prices in other countries.
WASHINGTON – House Republicans unveiled a sweeping tax plan that will become the central piece of President Donald Trump’s signature legislative accomplishment of his second term.
The proposal unveiled May 12 would make the 2017 Tax Cuts and Jobs Act permanent, increase the standard deduction, and increase the child tax credit to $2,500 through 2028 and $2,000 after that. The child tax credit is currently $2,000 but will drop back to $1,000 at the end of this year if not extended.
In a statement posted to Truth Social, Trump said the proposed bill is “GREAT” and sent a warning message to congressional Republicans who will likely push for changes: “We have no alternative, WE MUST WIN!”
It would also temporarily create a tax deduction for tips and overtime through 2028, and implement an additional $4,000 tax deduction for seniors.
It would raise the cap for state and local tax deductions to $30,000 from the $10,000 cap created in 2017, with a lower deduction for people who make more than $400,000. That provision is likely to create fireworks among House Republicans: Several GOP members from high-tax states have pushed for the cap to be raised higher, and some have already said they won’t support the bill as-is.
Children would be given $1,000 each for their parents opening in their name newly-created “money accounts for growth and investment,” also known as a “MAGA” savings account.
It would implement a 5% tax on money foreign workers in the United States send home to their families, with an exemption for U.S. citizens sending money abroad.
And it increases the debt ceiling by $4 trillion – a crucial move to avoid a catastrophic economic collapse when the government hits the current debt ceiling, as is expected in August.
The proposal also includes several provisions that reflect recent Republican causes: It increases taxes on private university endowments, with higher rates for larger endowments like those held by elite schools such as Harvard University and exceptions for religious universities; increase taxes on private foundations; and revoke the tax exempt status of “terrorist supporting organizations,” which some view as an attempt to punish pro-Palestinian nonprofit organizations.
It targets several clean energy tax credits implemented under the Democratic reconciliation bill passed under President Joe Biden, including eliminating tax credits for electric vehicles, credits for clean energy home investments, and sunsets tax credits for certain types of renewable energy production.
The House Ways and Means Committee plans to meet on May 13 to debate the proposal, which is already being slammed by Democrats as a giveaway to the wealthiest Americans.
Key conservative allies have endorsed the proposal. David McIntosh, president of the Club for Growth, said in a statement that the bill is “a critical step toward fulfilling the promises conservatives made to voters in the last election.”