President Donald Trump has expressed support for raising taxes on the wealthiest Americans to fund tax relief for middle- and lower-income brackets. He suggested increasing the top tax rate from 37% to 39.6% for individuals earning over $2.5 million, with exceptions for small businesses. Trump emphasized that this approach would allow for substantial tax cuts for the middle class and protection of programs like Medicaid. However, he cautioned that even a modest tax increase on the wealthy could have political repercussions, citing the 1992 re-election loss of President George H.W. Bush after breaking a no-new-taxes pledge.

House Speaker Mike Johnson is considering reducing the proposed $4.5 trillion tax cut package to $4 trillion amid disputes over spending cuts and permanent extensions of the 2017 Tax Cuts and Jobs Act. Trump has privately urged Johnson to raise the top tax rate and close the carried-interest loophole for Wall Street investors. While Senate Republican Whip John Thune has expressed opposition to raising taxes, some conservatives, including Rep. Andy Harris, support the tax hike to fund Trump's agenda.

The broader budget bill aims to include middle-class tax cuts, Medicaid protection, and funding for border security, deportations, energy deregulation, and military expansion.