President Donald Trump outlined his tax priorities in a meeting with Republican lawmakers, including a call to end the carried interest tax break used by private equity fund managers and expand the state and local tax deduction.

Akayla Gardner
Bloomberg News (TNS)

President Donald Trump outlined his tax priorities in a meeting with Republican lawmakers, including a call to end the carried interest tax break used by private equity fund managers and expand the state and local tax deduction.

White House Press Secretary Karoline Leavitt told reporters that Trump laid out those measures and other provisions he would like to see in a sweeping tax bill this year during a meeting Thursday.

Among the tax cuts he mentioned are his campaign pledges to end levies on tips, Social Security payments and overtime pay. Leavitt also said Trump wants to end what she cast as “special tax breaks for billionaire sports team owners” and create new cuts for made-in-America products.

That list included two new items that Trump didn’t highlight on the campaign trail — the end of the carried interest tax break and ending breaks for sports team owners — which could be used to partially offset the multi-trillion-dollar tax cut Republicans plan to pass before the end of the year.

The carried-interest tax break allows private equity managers and venture capitalists to pay lower rates on their earnings from the investments they make.

Republicans are also aiming to renew Trump’s signature 2017 tax cut law, including tax breaks for individuals and small businesses, which are set to expire in December.

Treasury Secretary Scott Bessent said administration officials were “just starting the process now” on tax policy, calling it a “priority” during an interview with Saleha Mohsin on Bloomberg Television Thursday.

“President Trump will give us his priorities, but I can tell you the real priority is fixing this affordability crisis for the American people,” he added.

The meeting between Trump and GOP lawmakers comes after Senate Republicans broke with their House counterparts, announcing a plan on Wednesday that would delay action on tax cuts until Congress passes a second budget reconciliation package. While the strategy would speed up GOP efforts to give Trump resources to expand his crackdown on undocumented migrants, it conflicts with the approach House Speaker Mike Johnson has in the works across the Capitol.

Johnson is instead moving to combine many of Trump’s legislative priorities, including both tax cuts and immigration, into a single bill. House Republicans only hold a narrow majority in the chamber and packaging different priorities together offers to make it harder for any GOP dissenters to defect.

How Trump and lawmakers resolve the impasse poses an early test for the new administration and Congress. Trump has said that while he would prefer one bill to address all of his priorities, he would accept two bills to achieve his goals. Republicans in both chambers are trying to use a process known as reconciliation, which would allow them to pass a budget without any Democratic votes.

The president is also seeking resources to carry out his immigration agenda, which aims to implement mass deportations of undocumented migrants and resume construction of a wall along the U.S.-Mexico border.

Republican Lindsey Graham of South Carolina, the chairman of the Senate Budget Committee, said their chamber’s measure would be a roughly $300 billion measure, with about $150 billion of that in new spending over four years for border security and immigration enforcement and a similar amount added for defense.