Trillions of dollars of tax cuts that are due to expire at the end of this year have several hurdles to jump before they can be certain, but President Trump maintains that millions of Americans will save tax under his policies.
Even without the finalization of passing of legislation to extend existing tax cuts, the president claimed Sunday that “When Tariffs cut in, many people’s Income Taxes will be substantially reduced, maybe even completely eliminated.”
A recent survey reveals a declining share of people nationwide think that the federal income taxes they pay are fair.
In a post on his Truth Social platform, Trump said that the “focus will be on people making less than $200,000 a year.” The statement is likely to have been in part to temper the view that the president’s focus is protecting the rich, following his comments on allowing tax breaks for wealthy people to expire to help pay for cuts for the less well off. "I think it would be very disruptive because a lot of the millionaires would leave the country,” Trump said last week.
If not agreed, those earning more than around $640,000 are facing a 39.6% tax rate compared to the currently reduced 37%. There is also talk of a new tax rate for those earning $1 million or more, but this is not seen as a likely scenario.
Trump’s social media post over the weekend also claimed that “massive numbers of jobs are already being created, with new plants and factories currently being built or planned,” and concluding that “the External Revenue Service is happening.”
However, tariffs are uncertain given that trade deal discussions are ongoing with several countries; and the tax cuts are uncertain given that the House and Senate are unlikely to agree on the same draft legislation, which will require reconciliation by committee before an agreed bill can be put to a vote. It could be close to the wire before cuts are passed, or not.
If tax cuts are not extended, The White House says that the average taxpayer could see bills rise by 22% in 2026, adding $1,700 to the tax burden of an average family of four, with businesses also facing significant tax hikes.
According to the 2025 Fiscal Policy National Survey conducted by YouGov for the Cato Institute, 81% of Americans say they can’t afford to pay higher taxes next year.
Trump’s approval rating for handling the economy has fallen to 42% from 51% in a little over a month, according to a CBS News poll and people are still concerned about rising prices. And the president was making no promises over the weekend that Americans will see tax cuts in the near term: “It’ll take a little while before we do that,” he said.
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