Conservatives are asking Trump for another big tax cut

Jeff Stein, (c) 2025 , The Washington Post

Thu, Jul 10, 2025, 10:15 AM 6 min read

Fresh off passage of the “One Big Beautiful Bill,” several conservative organizations and Republican lawmakers are preparing to ask President Donald Trump for another major tax cut - this time, potentially without congressional approval.

Trump’s tax and immigration law is projected to add more than $4 trillion to the national debt over the next 10 years, broadly reducing tax rates while cutting spending on Medicaid and clean energy subsidies. The legislation is the culmination of years of advocacy on the right, making permanent many of the 2017 tax cuts Trump approved during his first term, and it represents one of the most expensive new laws in decades.

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With that victory newly secured, conservative groups - including Americans for Tax Reform, led by anti-tax crusader Grover Norquist - are already asking the Trump administration to get behind another cut, which would drastically reduce what investors pay on their capital gains.

The plan rests on changing how the Treasury Department calculates those taxes.

Currently, an investor who bought stock for $1,000 in 1980 and sold it for $10,000 today would owe capital gains taxes on the increase in value of $9,000. But under the proposal pitched by Norquist and others, the calculation would start by adjusting up the value of the original purchase to account for inflation - which would reduce the amount of gain that’s taxable after selling the stock.

Although a 1992 Justice Department opinion found that such a change would require an act of Congress, Norquist and other conservatives want the Treasury Department to execute such a policy unilaterally if necessary, providing a major windfall for people selling stocks, art, businesses, homes and other assets.

One GOP senator, speaking on the condition of anonymity to describe private conversations, said he had spoken with Treasury Secretary Scott Bessent about reviving the idea. House Speaker Mike Johnson (R-Louisiana) has also been pitched on supporting such a plan in recent weeks, as advocates try to build congressional support, said two other people familiar with the matter, who also spoke on the condition of anonymity to discuss private deliberations.

The Trump administration weighed unilaterally implementing the change during the president’s first term but backed off after Steven Mnuchin, then treasury secretary, suggested Congress should lead on the matter. Conservative groups are also asking congressional Republicans to include the measure in a second tax legislative package, possibly later this year or next year. (Johnson has said the GOP plans to pass a second party-line legislative package in the fall and a third in the spring of next year.) But if that does not emerge, they are also optimistic that Bessent may prove more sympathetic than Mnuchin to their case for Trump to act by executive order.