As a seasoned tax attorney, I find the recent policy agenda developed by influential conservative groups for a potential second term of Donald Trump’s presidency particularly intriguing. This plan, known as the Mandate for Leadership, has already garnered attention for its controversial immigration recommendations. However, it also includes far-reaching tax and economic initiatives, including a shift to a consumption tax and greater White House control of the IRS. (source)
The umbrella group Project 2025, organized by the Heritage Foundation, claims to represent the views of about 100 conservative organizations that form its advisory board. The authors of this plan include Stephen Moore, a frequently quoted source of fiscal and monetary policy advice in Trump’s first term, and Russell Vought, who was Trump’s budget director and is considered a potential White House chief of staff in a second term.
The tax policy was not a top priority for Trump in his first term. However, the individual provisions of the Tax Cuts and Jobs Act (TCJA) expire at the end of 2025, which means the president and Congress will inevitably have big choices to make. The nearly 1000-page Mandate calls for dramatic changes. Rather than extending the TCJA, it would shift to a consumption tax in two steps.
First, it would replace the current revenue system with one built on individual income tax rates of 15 percent and 30 percent, with an unspecified standard deduction. The top bracket would kick in at the Social Security wage base, currently $168,600. Most deductions, credits, and exclusions would be repealed, though only a few are identified. For example, taxpayers could no longer deduct any state and local taxes or educational expenses. At the same time, nonresident parents with child support orders could claim a new credit.
The plan also proposes dramatic changes in government operations, including tax administration. It would increase the number of political appointees at the IRS and freeze its budget at current levels. More broadly, it would centralize control of the federal bureaucracy in the White House, freeze hiring, and give the president broad authority to fire federal workers.
While these proposals are ambitious, it remains to be seen whether they will be embraced in a potential second term. As always, it is crucial for us as responsible citizens to stay informed about these developments and understand their potential impact on our financial decisions and tax obligations.