GOP presidential candidate and former President Donald Trump pledged to eliminate taxes on overtime pay at a rally only days after his shaky performance in the presidential debate. He was looking to turn a new page with a fresh populist tax cut proposal.
“We will end all taxes on overtime,” said Trump Thursday at a rally in Tucson, Arizona. “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.”
The new plan would increase the value of hourly workers’ earnings for time and a half after 40 hours of work per week. This could motivate the blue-collar workers essential to his support base to show up to vote for him on Election Day.
Trump’s proposal came only two days after an unsteady debate performance for Trump that both surveys and analysts say was won by his opponent, Kamala Harris. Many Trump allies said the debate was a missed opportunity for the former president to focus on the economy—an issue polls indicate voters trust Trump over VP Harris on.
Over the past three months, the former president has rolled out a continuous drumbeat of tax cut plans targeted toward crucial election constituencies. Trump wants to eliminate all taxes on Social Security benefits — benefitting older voters — as well as taxes on tipped income — designed to appeal to hotel, restaurant, and casino workers in critical swing-state Nevada.
Former President Trump’s tax cuts on elderly benefits and tips have wide bipartisan appeal, according to a Bloomberg News/Morning Consult poll conducted last month. However, they come with a massive price tag. According to a Bloomberg review of Trump’s tax proposals, estimates indicate they could add over $10.5 trillion to the national debt over ten years.
Trump states his no-tax-on-overtime idea would assist companies in luring additional workers and keep them on the job site for longer.
“I went to some economists, great ones, and I said, ‘What do you think?’ They said, ‘It would be unbelievable.’ You’ll get a whole new workforce by doing the no taxes on overtime,” said Trump Thursday.
Spokesperson for the Harris campaign, Joseph Costello, said Trump “is desperate and scrambling and saying whatever it takes to try to trick people into voting for him.”
The Republican presidential candidate’s plan to eliminate taxes on tips — an idea also embraced by Harris…after Trump — has been panned by economists because it could allow employers and workers to dodge taxes by characterizing wages as tips.
Trump vows to cut mortgage rates
Former President Trump additionally vowed to cut mortgage rates to 2%, something he wouldn’t be able to control if he were to win another term.
Presidents don’t set mortgage rates and only have minimal influence over the U.S. Federal Reserve, which sets the cost levels for borrowing homes levels are based on. The Fed is set to meet next week and is predicted to reduce interest rates slightly.
U.S. mortgage rates have dropped to the lowest level since February 2023. Freddie Mac said in a Thursday statement that the average for a 30-year, fixed loan was down from 6.35% a week earlier to 6.2%.
