According to a senior economic advisor and a former administration official, US President Donald Trump is considering making new policy promises to voters ahead of the midterm elections. These potential pledges may include urging Congress to lower capital gains taxes and providing tax-free treatment on certain home sales.
White House National Economic Council Director Kevin Hassett stated in an interview on Tuesday that Trump aims to give voters more reasons to support the Republican Party. Larry Kudlow, who led the National Economic Council during Trump's first term and remains an ally, said he recently discussed capital gains tax indexation with Trump—adjusting taxable capital gains to account for inflation. He also proposed a capital gains tax exemption for home sales priced at up to $2 million, noting that "the boss is very interested in these ideas."
"I spoke with him; he likes the idea of capital gains tax indexation, and he also likes the idea of expanding the exemption scope," Kudlow said. Hassett added that Trump is seeking new policy concepts that could help Republicans attract voters. Most tax adjustments require congressional legislation, making it unlikely that these proposals will become law before the November midterm elections.
Previous administrations, including Trump's first term, have explored unilaterally linking capital gains taxes to inflation without congressional approval, but legal experts believe such a move would likely face judicial challenges. Republican lawmakers in Congress have also proposed capital gains tax indexation, though the issue has not yet gained unanimous support within the party. However, whether adjusting capital gains taxes or expanding home sale tax exemptions, the benefits would disproportionately favor the wealthy, potentially exposing Republicans to political criticism.
When asked about the policy proposals under consideration, White House spokesperson Kush Desai said Trump is "always exploring new ideas to make America great again, but any policy announcements will be made directly by the administration."