Donald Trump Announces New Tax Plan

Former President Donald Trump has announced a new plan to cut taxes if elected in November’s election.

Trump said during a rally in Tucson, Arizona, on Thursday that he would “end all taxes on overtime” if he returns to the White House.

The former president previously backed a plan to eliminate taxes on tips, which was also supported by his Democratic presidential election opponent, Vice President Kamala Harris.

“I went to some economists, great ones, I said, ‘What do you think?'” Trump said on Thursday. “They said, ‘It would be unbelievable, you’ll get a whole new workforce by doing that.’ No taxes on overtime.”

“The people who work overtime are among the hardest-working citizens in our country,” he added. “When you’re past 40 hours a week, your overtime hours will be tax-free. OK, good?”

Newsweek reached out for comment to the Trump and Harris campaigns via email on Thursday evening.

Congress would likely need to pass legislation for any of the proposed tax cuts by Trump—or Harris—to take effect.

Before Trump’s presidency, a measure during former President Barack Obama‘s administration was launched to lower the upper salary threshold for workers to be eligible for overtime. It was struck down in court following a challenge by Republican-led states.

The Trump administration later set a higher threshold to qualify for overtime than Obama’s proposal, still lower than the threshold put in place following the court ruling. Despite these changes, the taxation of overtime pay has remained consistent, meaning that Trump’s current proposal would represent a significant shift in tax policy for millions of workers.

Both candidates have made tax reform a major point of their platforms, with Trump’s latest proposal being part of a broader economic plan. During the Tucson rally, Trump reiterated other campaign promises, including eliminating taxes on tips and ensuring that seniors would not pay taxes on Social Security benefits.

The KamalaHQ account on X shared a video on August 28 of vice presidential candidate Governor Tim Walz claiming that the Trump administration “blocked overtime benefits for millions of workers”, a fact that’s misleading. Under Trump’s rule, 1.2 million more workers became eligible for overtime pay, compared to the 4.2 million under Obama’s blocked plan. Walz also said Trump “opposed efforts to raise minimum wage” when Trump opposed a national increase and instead favored letting the states decide.

He implored his audience to “make sure you’re counting on what was delivered.”

Vice President Kamala Harris has also put forth an economic plan focused on supporting working families, with key initiatives aimed at improving access to affordable housing and expanding the child tax credit.

Harris has advocated for policies that would reduce housing costs for low- and middle-income families, proposing increased federal investment in affordable housing and assistance for renters. Additionally, she has been a strong supporter of making the expanded child tax credit, introduced during the Biden administration, permanent. The credit, which provided up to $3,600 per child annually, was designed to lift millions of children out of poverty by giving families direct financial support. Harris has emphasized that these policies are crucial for reducing economic inequality and helping families meet rising costs.

Update 09/12/24 8:19 p.m. ET: This article was updated with additional information and context.