Trump Proposes Ending Tax Benefits for Billionaire Sports Team Owners and Hedge Fund Managers to Offset ‘No Tax on Tips’ and Social Security Tax Cuts
OAN Staff Brooke Mallory
5:03 PM – Thursday, February 6, 2025
President Donald Trump has urged Congressional Republican leaders to eliminate tax advantages for hedge fund managers and wealthy sports team owners as part of his proposals to end taxes on tips, overtime, and Social Security payments, as well as increase the state and local tax deduction cap from $10,000.
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“This will represent the largest tax cut in history for middle-class, working Americans,” White House Press Secretary Karoline Leavitt informed reporters while Trump held discussions with GOP leaders in the West Wing.
Leavitt described Trump’s requests as part of the administration’s “tax priorities” — presenting a prepared agenda for approval by the Republican-controlled House and Senate.
“We advocate no tax on tips, aligning with a definite campaign promise from the president. No taxes on seniors’ Social Security, no tax on overtime pay, and the continuation of President Trump’s 2017 middle-class tax cuts,” stated Leavitt.
“We propose adjustments to the SALT cap; the removal of special tax incentives for billionaire sports team owners; the closure of loopholes in the carried interest tax deduction; and tax reductions for ‘Made in America’ products,” she added.
House and Senate leaders have engaged in preliminary discussions on the best way forward; therefore, the inclusion of all proposed topics in the pending legislation remains uncertain.
Trump consulted with lawmakers for over five hours on Thursday.
“We delved deeply into the specifics of what needs to be addressed regarding both the budget and reconciliation issues,” stated House Majority Leader Steve Scalise (R-La.) to the press. “President Trump was fully involved throughout the meeting, and we are refining the areas where we differ.”
“We utilized a whiteboard to outline various numbers, ensuring everyone was aligned,” he added.
While Scalise did not explicitly state if any significant breakthroughs occurred, he indicated that “serious progress” had been made and that lawmakers are “very close to advancing this to the Budget Committee.”
The House Budget Committee has delayed plans to finalize a resolution this week, which would trigger the Senate reconciliation process intended to enact Trump’s expansive agenda — all while circumventing a Democratic filibuster.
In the Senate, Republicans are competing for control of Trump’s agenda package, especially after Senate Budget Committee Chairman Lindsey Graham (R-S.C.) announced intentions to pursue an alternative budget resolution following the delay, as reported by The Post.
Should this occur, Graham would embrace the Senate GOP’s preferred two-bill strategy, comprising an initial bill addressing energy, defense, and border issues, succeeded by a second tax package.
Considering Congress typically has the capacity to pass only one budget reconciliation bill for each fiscal year, the second package is likely to face greater challenges in securing 60 votes in the Senate and will require the support of Democrats.
Johnson advocates incorporating Trump’s demands into a comprehensive budget reconciliation bill that could pass both chambers with a narrow majority. Given the tax-related provisions, this bill would need to be introduced in the House first.
“We anticipate being able to announce something, likely by tomorrow, and we are enthusiastic about it,” Johnson informed reporters. “Our aim is to have the Budget Committee potentially commence its work early next week, possibly by Tuesday, for a markup on the budget resolution.”
The debate over whether to include a debt ceiling increase within the larger Trump agenda package or to address it separately has also sparked division among certain Republicans. Democrats have indicated that they would be inclined to negotiate compromises if the latter choice is made and there aren’t enough conservative Republicans in agreement.
Regardless, Scalise reaffirmed that the White House meeting “yielded significant advancements.”
Although Congress does not expect to face a deadline for raising the debt ceiling until June, it was suspended up until the beginning of last month.
Trump’s tax promises to workers and retirees were a considerable factor in his 2024 election victory—he credit’s his pledge to abolish taxes on tips for being a key element in becoming the first Republican to win in Nevada in 20 years.
Scalise acknowledged that “while we haven’t fully resolved the SALT issue, we’ve made noteworthy progress on that front.”
Some revenue deficits might be balanced out by Trump’s proposals to tackle loopholes affecting hedge fund managers and sports team owners.
According to Americans for Financial Reform, reforming the carried-interest policy could generate between $1.4 billion and $18 billion annually by categorizing investment fund managers’ earnings as regular income instead of capital gains, which are taxed at lower rates.
While the precise amount the government might recover from changes to sports owner taxation is uncertain, experts suggest it is likely to be in the billions.
Currently, team owners can deduct the entire franchise purchase price from their tax obligations over a 15-year span. The Washington Commanders football team sold for a record $6.05 billion in 2023, underscoring the magnitude of these transactions.
Moreover, in addition to tax perks linked to municipal loans for professional sports stadiums, estimated to cost the government around $4.3 billion in lost revenues, sports team owners receive various other federal benefits.
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