Sen. Bernie Sanders and Rep. Alexandria Ocasio-Cortez, two pillars and allies of the progressive movement, are in disagreement.

Democrats have in recent months proposed a variety of tax cut proposals, seemingly in response to President Donald Trump’s popular “no tax on tips and overtime” policies.

Sen. Chris Van Hollen wants to eliminate income taxes for households earning under $92,000, and Sen. Cory Booker wants to raise the household standard deduction to $75,000. Other tax cut proposals are sweeping gubernatorial races from California to Georgia, like Keisha Lance Bottom’s proposal to exempt public school teachers from state income tax.

Sanders has co-sponsored Van Hollen’s Working Americans’ Tax Cut Act, as have 19 other Democrats spanning the moderate and progressive wings of the party. The bill would implement an additional tax on millionaires to offset a tax cut for working-class Americans. The Yale Budget Lab concluded in a report last month that Van Hollen’s bill would be budget neutral.

Ocasio-Cortez isn’t convinced. She’s not sure that these are the kinds of proposals Democrats should start building an agenda around.

“When you actually look at the totality of what’s being put forward, we are seeing a total gutting of a resource base,” Ocasio-Cortez told NOTUS. “If people want to choose between whether they want guaranteed health care or a 5% tax rebate, people are going to want guaranteed health care.”

“It’s not to say that I object to any and all like tax cuts or tax rebates, right? We can help people who are struggling, but I don’t think that the biggest impact in how you help someone and how we help people make ends meet is through that avenue,” she said.

When asked whether tax cuts for working-class people or building out social programs are better for easing income inequality, Sanders said, “You could do both.”

The differences between Ocasio-Cortez and Sanders’ approach are indicative of the divides Democrats must bridge as they form their agenda going into 2028. It’s also a sign that progressives have not quite coalesced around a strategy to put forward their economic vision — even if they agree on policy.

Proponents of tax cuts for average earners say the revenue will be recouped from tax hikes on the wealthiest Americans, particularly Sanders and Rep. Ro Khanna’s proposal to implement a 5% wealth tax on billionaires.

In addition to significantly expanding the standard deduction, Booker’s plan would expand the child and earned income tax credits — and raise corporate and high-income tax rates to pay for it.

“It’s the most just way to go about dealing with the biggest challenge for voters right now, which is the costs — all of us are dealing with these rising costs,” Booker said. “This is a direct way to deal with that.”

Van Hollen’s plan includes a tiered surtax on wages, salaries, capital gains and investment income over $1 million to pay for the tax cuts for lower earners.

Even so, Khanna said income taxes on low- and middle-income earners should remain in place “within a range.”

“I’m for funding Medicare for All, $10 a day childcare, having a tax on billionaires and cutting defense,” Khanna said.

But with ambitious wealth taxes unlikely to survive a filibuster, even in a Democratic-held Senate, it’s an open question whether easier-to-pass tax cuts will come at the expense of expanded social programs.

“We can do two things at once. We can provide tax relief to people who are working paycheck to paycheck, which is what the Working Americans’ Tax Cut bill does, and we can generate revenue to extend the Affordable Care Act tax credits and accomplish other important things for the country,” Van Hollen said.

Many Democrats seem ready to line up behind his and other legislators’ tax cut proposals.

“I’m all for cutting taxes, especially to working people,” Rep. Melanie Stansbury said.

Stansbury pointed to her home state of New Mexico, where the median income was almost 24% below the national average in 2024, but the state funds free college and child care, partly through taxes on oil and gas production.

“The federal government can do that, they just have to make choices about how they allocate funding,” Stansbury said. “It’s all about priorities.”

Rep. Ilhan Omar, deputy chair of the Congressional Progressive Caucus, said she “would probably be supporting” Van Hollen’s bill and lost income tax revenue should be made up with taxes on the wealthy and corporations.

The Progressive Caucus has not convened to discuss the proposals, Rep. Greg Casar said, though he and others are “really seriously” considering them.

“I’m glad that Cory, Chris and others are looking at all sorts of options, because we should get all the ideas out there on the table right now while we’re in the minority, so that we’re ready to go and have had the debate by the time we’re back in power,” said Casar, who chairs the CPC.

For Ocasio-Cortez, who has long been an advocate of taxing the wealthy and transforming social services, wiping out significant tax revenue goes too far.

Ocasio-Cortez said “across the board” tax cut proposals on the table amount to an “attack” on young people.

“It is a complete defunding of the world that young people will have to live in, and they are asking young people to foot the bill,” Ocasio-Cortez said.