Tack on one more to Trump’s tax-cut pledges: No tax on overtime pay

Former President Donald Trump said on Thursday, Sept. 12, he would add another tax cut to his agenda if elected to the White House in November. This time, the Republican nominee pledged to eliminate taxes on overtime pay .

"The people who work overtime are among the hardest-working citizens in our country, and for too long, no one in Washington has been looking out for them," Trump said during an event in Tucson, Arizona . "Those are the people that really work. They’re police officers, nurses, factory workers, construction workers, truck drivers and machine operators."

The latest proposal to cut taxes on overtime pay joins his pledges to cut taxes on Social Security benefits and abolish taxes on tipped income , an idea embraced by his opponent, Vice President Kamala Harris .

For its part, the Harris campaign called the proposal a ploy to win over voters reliant on overtime income.

"He is desperate and scrambling and saying whatever it takes to try to trick people into voting for him,” Harris campaign spokesperson Joseph Costell said in a statement.

Before the former president suggested he would slash taxes on overtime, Harris claimed he had "blocked overtime benefits from millions of workers" while he was in the White House.

Under former President Barack Obama, the Labor Department proposed raising the threshold for overtime exemption to $47,476 from $23,660, which would have made millions more workers eligible for overtime pay. The Trump administration was able to change it to $35,568, short of what Democrats were hoping for.

Under President Joe Biden, the overtime threshold was raised to $43,888 in 2024 and starting Jan. 1, 2025, it increases to $58,656, meaning anyone making less than that must make overtime pay after 40 hours of work.

It is unclear at this time how much revenue the government brings in on overtime pay each year. But there has been plenty of analysis on his other proposals.

Extending the Trump tax cuts for the next 10 years would add $4.6 trillion to the national deficit, according to the nonpartisan Congressional Budget Office . Ending taxes on Social Security benefits would add between $1.6 trillion and $1.8 trillion through 2035, according to the bipartisan Committee for a Responsible Federal Budget. And no taxes on tips would reduce federal revenues by between $150 billion and $250 billion over 10 years , according to CRFB estimates.

Trump has previously said his tariffs would pay for his tax cuts. The CRFB has estimated that a 10% across-the-board tariff would raise $2.5 trillion over 10 years , while a 60% tariff on Chinese goods would, on its face, generate $2.4 trillion, but over time, would produce far less revenue or even lose revenue once trade behavior changes due to the massive penalties of trade with China.

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