White House says no plan to end payroll tax permanently

Laura Davison, Bloomberg News on

Published in Business News

WASHINGTON -- White House officials said the administration has no plans to do away with the payroll tax despite President Donald Trump saying he would seek a permanent repeal if he wins another term.

Even if Trump were to follow through, the idea of doing away with the tax is unlikely to get much support in Congress because it could drive up the deficit by trillions of dollars to plug a funding gap, or spell the end of some Social Security payments for millions of Americans.

"The idea is drastic and crazy," said Brian Riedl, a senior fellow at the conservative Manhattan Institute. "It is complete fantasyland."

Alan Viard, resident scholar at the conservative American Enterprise Institute and a former Treasury official in the George W. Bush administration called it "absolutely insane" and an "unfathomable" proposal.

"The only silver lining here is that there is zero chance of this being adopted," Viard said.

Trump has suggested a radical revamp to the taxes, which fund Social Security and Medicare, several times over the past week, saying he'll make a move in that direction if he wins reelection.


"On the assumption I win, we are going to be terminating the payroll tax after the beginning of the new year," Trump said Wednesday.

White House press secretary Kayleigh McEnany and a second official, who spoke on condition of anonymity, said Trump is only talking about forgiving the worker payroll taxes he deferred last week with an executive action set to be in place from Sept. 1 to the end of the year.

"What he was meaning yesterday is he wants permanent forgiveness of the deferral," McEnany said at a press briefing Thursday.

But Trump has said more than once he wants to end the payroll tax. "If I win, I may extend and terminate. In other words, I'll extend it beyond the end of the year and terminate the tax," he said of the payroll tax on Saturday.


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