Reality Check: What Donald Trump Has Said About Taxes And The Wealthy

May 13, 2016
Originally published on May 16, 2016 1:50 pm

Donald Trump has made various statements about his tax plan in recent days that have left some people pretty confused about just what he'd like to do. Here's a guide to interpreting his remarks.

"In other words, it's going to cost me a fortune." — News conference, Sept. 28, 2015

At a news conference at Trump Tower, Trump unveiled a series of proposals to dramatically simplify and cut business and personal taxes.

The proposals would have reduced the top marginal tax rate from 39.6 to 25 percent for couples with annual income above $300,000, which would have meant big cuts for high-income people.

Trump maintained that the cuts would benefit middle-class families and that the rich would actually end up paying more in taxes, because he would eliminate unspecified deductions and loopholes.

Analysts who studied the proposals say they would increase the federal budget deficit by as much as $11 trillion over the first decade.

"For the wealthy, I think, frankly, it's going to go up. And you know what? It really should go up." — NBC's Meet the Press, May 7

Last weekend, during appearances on NBC's Meet The Press and ABC This Week, Trump appeared to suggest that he favors higher taxes on wealthy individuals. If true, it marked a significant departure from longtime Republican dogma on taxes, and many in the GOP were, to say the least, confused.

"Even this morning, you know, he's talking about changing his tax policy and raising taxes," said Rep. Sean Duffy, R-Wis., a Trump supporter. "We want to button him down and say, 'Where are we going to go, Mr. Trump, if you're president?' "

"I'm not talking raise from where they are now. I'm talking raise from my low proposal." — Fox Business Network, May 9

Starting Monday, Trump sought to clarify his remarks, with interviews in The Wall Street Journal and on Fox Business Network, among others.

Trump said he absolutely does not favor raising taxes on the wealthy, or anyone else for that matter.

But he acknowledged that in negotiations with Congress, he would almost certainly have to concede on some points, and his plan might have to be scaled back a bit. The rich would still get a tax cut, but it wouldn't be as big as he first proposed.

"The interesting thing about how Trump looks at this stuff is, he sort of compromises his negotiating position right upfront by admitting that he doesn't really think this is really his plan, and that's something unusual, something I've not seen from other political candidates," says Alan Cole, an economist at the Tax Foundation.

Stephen Moore, a prominent conservative commentator and founder of the Club for Growth, who met with Trump several weeks ago, says he remains convinced that the candidate is committed to tax cuts.

"He told us in the meeting he wants to cut tax rates. He believes this is the way to grow the economy, and I take him at his word on that. I think that's been a centerpiece of what he's been talking about on taxes," Moore said.

But Moore says he and other conservatives, including Larry Kudlow and Arthur Laffer, have met with Trump staffers to discuss ways to tweak Trump's tax cuts, to mitigate their impact on the deficit. While Trump hasn't actually endorsed their ideas, his staff seems willing to consider them, Moore says.

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Last September Donald Trump proposed a series of large tax cuts on individuals and businesses. Analysts who studied the proposals said they would almost certainly increase the federal budget deficit by large amounts. In recent days, however, Trump has appeared to walk back part of his proposal in ways that have left many observers perplexed. NPR's Jim Zarroli reports.

JIM ZARROLI, BYLINE: When Donald Trump first proposed tax cuts last year, he said they'd benefit everyone from middle-class families to the rich. Then last Sunday in an interview with George Stephanopoulos on ABC "This Week," Trump appeared to say something different.

(SOUNDBITE OF TV SHOW, "THIS WEEK")

STEPHANOPOULOS: Bottom line, do you want taxes on the wealthy to go up or down?

DONALD TRUMP: They will go up a little bit, and they may go up, you know, above...

STEPHANOPOULOS: But they're going down in your plan.

TRUMP: No, no, in my plan they're going down, but by the time it's negotiated, they'll go up.

ZARROLI: The comments caused some confusion. Was Trump saying he wanted to raise taxes on the rich? Absolutely not, Trump said. Here he was on Fox Business Network on Monday.

(SOUNDBITE OF ARCHIVED RECORDING)

TRUMP: But I'm not talking raised from where they are now. I'm talking about raised from my low proposal.

ZARROLI: In other words, Trump said, he still wants to cut taxes on the rich. But, he says, the cuts may not end up being as big as he first proposed. He'd have to negotiate with Congress. He wouldn't get everything he wanted. Trump's stated willingness to compromise is a decided departure from the never-say-die rhetoric that Republicans have traditionally employed on tax issues. Alan Cole is an economist at the Tax Foundation.

ALAN COLE: The interesting thing about how Trump looks at this stuff is he sort of compromises his negotiating position right up front by admitting that he doesn't really think that this is his plan, and that's something unusual, something that I've never really seen from other political candidates.

ZARROLI: Of course Trump's comments left open the question of just where he really stands on taxes and how much compromising he'd ultimately be willing to do.

Len Burman of the Tax Policy Center says it's true that Trump probably can't get the kinds of large tax cuts he wants through Congress. They'd get watered down.

LEN BURMAN: It is always what happens anyway, but if you look at history, the presidential candidate's proposals often end up being enacted in some form.

ZARROLI: Burman says presidents such as Ronald Reagan, Bill Clinton, George W. Bush and Barack Obama all ended up getting their tax proposals approved in some form, so it matters what Trump is saying. Burman says Trump may be shifting his views on the feasibility of big tax cuts.

BURMAN: One possibility is that he now understands the effect of his proposal and it's really an enormous tax cut on very high-income people.

ZARROLI: But Stephen Moore, a prominent conservative commentator, says Trump's comments last weekend about tax cuts for the rich were misunderstood. Moore met with Trump a few weeks ago to discuss ways to tweak his tax proposals.

STEPHEN MOORE: He told us in the meeting he wants to cut tax rates. He believes this is the way to grow the economy. And I take him for his word on that. I think that's been a centerpiece of what he's been talking about on taxes.

ZARROLI: Moore says he and other conservatives such as Larry Kudlow are working with Trump staffers to revise Trump's tax plans to lessen the impact on the deficit. He says there's no guarantee Trump will adopt any of these ideas, but right now he seems to be listening. Jim Zarroli, NPR News, New York. Transcript provided by NPR, Copyright NPR.