We won’t be dealing with political issues in this article, only expectations that seem likely to be pursued following Jan. 20, 2025, when President-elect Donald Trump takes office. The purpose of this article is to help you in terms of your own financial planning, because some of these expected changes will likely affect you—and perhaps your business or employer.
Trump will announce his plans for government in due course, but here are the larger issues he talked about during his presidential election campaign. He wants to protect U.S. industry, boost the in-country businesses, and encourage Americans to buy American products.
Taxes
The corporate income tax was lowered from 21 percent to 15 percent, along with an extension of the 2017 tax changes Trump initiated in his first term. Some of the Biden-era tax hikes on wealthy Americans will likely be rolled back. As for the middle class? Exempting taxes on tips, overtime wages, and Social Security for seniors are all going to be put forth in early 2025. Climate action-related energy measures in President Joe Biden’s Inflation Reduction Act are likely to be scrapped.
Trade and Tariffs
Emphasis will shift from global markets to domestic economic interests. Tariffs of 10–20 percent on foreign imports can be expected, and, in some specific cases such as China’s electric vehicles (EVs), those tariffs may be even higher. Trump also favors a policy that creates incentives via the Food and Drug Administration for “essential” medications to be sourced solely from U.S. companies. Foreign investment in America will be prevented in cases where they affect our strategic interests that are presumed “vital” to American economic strength and vibrancy.
Secretary of Cost Cutting: Elon Musk
A meat cleaver rather than a scalpel will likely be the tool of choice when it comes to federal bureaucracies. A proposal to shutter the Department of Education, along with streamlining, combining, or significantly reducing other federal departments, may be disruptive, but stands to reduce federal spending substantially. Musk’s cuts at Twitter/X and his layoffs at Tesla demonstrate his mettle when it comes to making these hard decisions to cut costs.
