Trump Weighs Capital Gains Tax Cuts Ahead Of Midterm Elections

President Donald Trump is considering a new capital-gains tax push ahead of the November midterm elections. The discussions could lead to Trump calling on Congress to cut capital gains taxes, but no legislation or formal White House proposal has been released.

National Economic Council Director Kevin Hassett said Trump is developing additional policy commitments that Republicans could take to voters before November. One option under discussion would index an asset's cost basis for inflation, effectively taxing only the gain remaining after changes in the price level are removed.

Former National Economic Council Director Larry Kudlow recently discussed this approach directly with Trump and said the president was receptive. Kudlow also proposed exempting gains on sales of homes valued at $2 million or less. The current federal rules allow qualifying homeowners to exclude up to $250,000 of gains from a primary residence, rising to $500,000 for many married couples filing jointly.

A broad capital-gains indexing regime could become relevant to digital assets like Bitcoin and Ether if cryptocurrencies remain within its scope. The U.S. taxpayers currently report sales and exchanges of capital assets through the federal capital-gains framework, while digital-asset transactions increasingly feed into the same reporting infrastructure.

Any changes to capital-gains taxation would require congressional approval. An administration attempt to introduce inflation indexing without Congress could also face legal challenges, an issue that has surfaced during previous efforts to reinterpret how asset basis is calculated.