Scott Bessent, the hedge fund manager tapped to lead the Treasury Department, revealed that his top priority will be extending the tax policies of President-elect Donald Trump’s first term and eliminating levies on service workers’ tips, among other campaign promises.
In a recent interview with the Wall Street Journal, Bessent said he would work to slash taxes on tips, overtime and Social Security, while making Trump’s tax cuts through the 2017 Tax Cuts and Jobs Act permanent.
“Maintaining the status of the dollar as the world’s reserve currency” would also be a top focus, he said, as would enacting tariffs and cutting federal spending.
The listed priorities are in line with what Trump promised throughout his campaign, telling voters he would end taxes in key areas for those working service jobs as well as for seniors.
The price tag on extending the individual and corporate rates from Trump’s 2017 law, which includes a $2,000 Child Tax Credit and estate tax exemption, could run up the deficit by as much as $5.35 trillion, according to a nonpartisan analysis by the Committee for a Responsible Federal Budget, though the figure could be nearly a trillion dollars lower should the US see faster economic growth.
Removing overtime income and service industry workers’ tips from taxation would add $2.3 trillion more to the national debt.
And $1.3 trillion would be heaped onto the deficit if Trump slashed taxation on Social Security benefits for seniors.
But his additional pledge to slap a baseline tariff of 10% on all imported goods could raise tax revenues by as much as $2.7 trillion.
Bessent has argued that the tax cuts alongside deregulation of some US industries will lead to an “economic lollapalooza.”
Trump selected him for the position after weeks of mulling over a slate of experienced candidates.
One wing of Trump allies were pushing for Bessent — who is the first openly gay cabinet member and has been an economic adviser and donor for the former president — while others were more keen on Cantor Fitzgerald CEO Howard Lutnick taking up the role.
Apollo Global Management CEO Marc Rowan and financier Kevin Warsh were also being considered.
Trump celebrated Bessent in his announcement statement, saying, “On the eve of our Great Country’s 250th Anniversary, he will help me usher in a new Golden Age for the United States, as we fortify our position as the World’s leading Economy, Center of Innovation and Entrepreneurialism, Destination for Capital, while always, and without question, maintaining the U.S. Dollar as the Reserve Currency of the World.”
“Unlike in past Administrations, we will ensure that no Americans will be left behind in the next and Greatest Economic Boom, and Scott will lead that effort for me, and the Great People of the United States of America,” the soon-to-be 47th president said.
Trump’s 2017 tax cuts will expire after December 2025, giving his administration and a Republican-led Congress the upper hand in crafting the new legislation.
No president has ever slashed taxes on tips, Social Security and overtime — and Vice President-elect JD Vance has also suggested raising the Child Tax Credit to as high as $5,000 per dependent.
