Speaker Paul D. Ryan said Friday that an upcoming tax overhaul bill will include a fourth income tax bracket for high-income earners, but he declined to reveal what the tax rate for that bracket will be.
“The fourth bracket that the president and others are talking about that we’re going to do, we’re working on those numbers,” the Wisconsin Republican said on “CBS This Morning.” He added later in the interview that numbers “are going to be finalized in a matter of days.”
The “unified” tax framework Republicans released last month proposed collapsing the existing seven tax brackets into three with rates of 12, 25 and 35 percent. It left open the possibility of the final tax bill including a fourth tax bracket if needed to ensure the primary benefits of the tax cuts were reaching middle-income earners.
“The president is the one who has been very insistent that we introduce what we call the fourth bracket, meaning we don’t lower taxes for high-income individuals … so that all that revenue goes to the middle-class tax cut,” Ryan said.
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Ryan and other GOP lawmakers had expressed hope that a fourth bracket would not be necessary, but it appears either the cost and distributional analyses have proven it is or Trump’s insistence has led to the decision to include one.
“We’ll introduce the bill, which will have that fourth bracket designed to make sure that we don’t have a big drop in income tax rates for high-income people — their bracket is 39.6 [percent] right now — and then we have a middle-class tax cut,” Ryan said.