Ted Cruz asks Treasury to approve $200 billion tax cut without Congress
Cruz and Sen. Tim Scott are pushing for a big change in tax policy ahead of the 2026 midterms.
March 3, 2026
Sen. Ted Cruz (R-Texas). (Demetrius Freeman/The Washington Post)
By Jeff Stein
Two leading Republican senators are asking the Trump administration to approve a $200 billion tax cut without congressional approval, as the GOP aims to improve its economic approval rating with voters ahead of the 2026 midterm elections.
Sens. Ted Cruz (R-Texas) and Tim Scott (R-South Carolina) will send a letter to Treasury Secretary Scott Bessent on Tuesday urging him to use executive authority to reduce some of the taxes paid on capital gains — a change that would lower the tax burden on Americans selling stocks, businesses, homes and other assets, according to a copy obtained by The Washington Post ahead of its release. The senators argue the administration does not need congressional approval to make the shift, although some conservative legal experts and Treasury officials have disagreed with that conclusion in the past.
President Donald Trump last year worked with congressional Republicans to approve the “One Big Beautiful Bill” — a sweeping tax package that made permanent many of the 2017 Trump tax cuts and was estimated to cost more than $3 trillion. With that victory secured, some conservatives are pivoting to push for additional tax relief, especially as Trump has appeared to rule out the possibility of getting Congress to approve another tax bill this year.
The plan pushed by Cruz and Scott has been sought by conservatives for many years. Under current law, an investor who bought $100 worth of stock in 1990 and sold it today for $300 would currently owe capital gains taxes on the full $200 in profit. But the $100 investment in 1990 would be worth roughly $230 in today’s dollars after accounting for inflation. Under the Cruz-Scott proposal, the investor would only owe taxes on that $70, rather than the full $200. That is why the proposal is known as “indexing capital gains for inflation.”
Follow Trump’s second termFollow
The senators also frame the proposal as a potential solution to the nation’s housing market, arguing that many homeowners are choosing to stay in their properties rather than sell and face a steep capital gains bill.
Cruz’s office estimated the change would cost roughly $200 billion. Many tax experts have been skeptical of the idea, arguing that more affluent households are the ones who would benefit most from steep reductions in taxes on large stock and home purchases. Cruz’s office pointed to analyses by analysts at Moody’s and the Cato Institute on the potential upside to the housing market.Ask The Post AIDive deeper
“Using your executive authority to … eliminate an unfair inflation tax on everyday Americans is the single most pro-growth economic action the administration can take unilaterally, and it would boost savings, spur investment, and create jobs nationwide,” the senators write in the letter.
The proposal, however, faces significant legal and political headwinds. A 1992 opinion by the Justice Department’s Office of Legal Counsel concluded that Treasury does not have the authority to make such a change unilaterally — and that it would require an act of Congress. Any executive action along these lines would likely face immediate legal challenges.
‘Titanic’ statue of Trump and Epstein on the Mall draws praise, scorn
Whistleblower claims ex-DOGE member says he took Social Security data to ne…
How to give your old sneakers a second life
Drone hits U.S. diplomatic facility in Iraq as Mideast violence deepens
Here’s what to eat to sleep a little better every day
Trump’s pick advances in race to replace Marjorie Taylor Greene
The Oscars are usually wrong. Here are the real best pictures.
Why Congress keeps handing Trump its power
Judith Martin, Nicholas Martin and Jacobina Martin
Miss Manners: Last in my immediate family to know my brother eloped
Voting machine company Smartmatic says DOJ is targeting it to bolster false…
Critics also argue that the benefits would flow overwhelmingly to the wealthy. The Penn Wharton Budget Model found during Trump’s first term that the top 1 percent of income earners would receive roughly 86 percent of the benefits from indexing capital gains to inflation, while the bottom 80 percent of earners would receive just 1 percent.
It remains unclear whether Bessent is inclined to pursue the change. The administration has also been lobbied to adopt the measure by Grover Norquist and Stephen Moore, two conservative tax experts. Norquist previously told The Washington Post that he pitched Trump directly about the plan, and that the president seemed receptive.Ask The Post AIDive deeper
During Trump’s first term, then-Treasury Secretary Steven Mnuchin weighed the option before ultimately concluding that Congress should act instead. Conservative allies of the administration are optimistic Bessent may be more receptive.
“We stand ready to support you in providing relief to everyday Americans who are still reeling from President Joe Biden’s historic inflation crisis,” Cruz and Scott write.
What readers are saying
The comments overwhelmingly criticize the proposal by Senators Ted Cruz and Tim Scott to approve a $200 billion tax cut without Congressional approval. Many commenters express concern that the tax cut would disproportionately benefit the wealthy, exacerbating income inequality… Show more
This summary is AI-generated. AI can make mistakes and this summary is not a replacement for reading the comments.
Comments 1,070
By Jeff SteinJeff Stein is the chief economics correspondent for The Washington Post. He was a crime reporter for the Syracuse Post-Standard and, in 2014, founded the local news nonprofit the Ithaca Voice in Upstate New York. He was also a reporter for Vox.follow on X@jstein_wapo
View this Washington Post article CLICK HERE
Media Air Base, LLC 
Leave a comment