US President Donald Trump, addressing US military personnel via video call from Florida during Thanksgiving, proposed slashing or fully eliminating income tax over the next two years by tapping into vast tariff revenues from imports worldwide.
He declared: “Over the next couple of years, I think we’ll substantially be cutting and maybe cutting out completely, but we’ll be cutting income tax… Could be almost completely cutting it because the money we’re taking in is going to be so large.”
This vision targets relief for those earning under $200,000 with ideas like a $2,000 “tariff dividend,” while aiming to revive manufacturing; however, economists note fiscal 2025 tariffs generated just $195 billion against $2.66 trillion in income taxes, Democrats flag consumer price hikes, and Supreme Court cases loom over legality with no congressional bill introduced yet.
Tariff Hauls Ignite Tax Overhaul Dreams
Trump painted a picture of unprecedented economic might, spotlighting projected tariff windfalls from key trading partners such as Japan at $650 billion, South Korea at $350 billion, and the European Union at $950 billion, framing these duties as shields for American workers and engines for trillions in revenue to supplant the income tax system entirely.
Commerce Secretary Howard Lutnick has championed the concept, earlier advocating zero income taxes for individuals below $150,000 annually alongside exemptions for overtime pay, tips, and Social Security benefits, though he later described it as an aspirational target contingent on balancing federal budgets through a proposed External Revenue Service for tariff collection.
Fiscal 2026 forecasts predict $400 billion from tariffs, yet analysts warn that aggressive scaling could trigger inflation, supply chain disruptions, and recessions, as tariffs effectively act like a consumption tax passed onto US buyers.
Prior Echoes on Truth Social
President Donald Trump has repeatedly championed the idea of eliminating income tax via tariffs on Truth Social well before his 27 November 2025 Thanksgiving remarks, using the platform to amplify his vision directly to supporters.
In a notable October 2024 post amid his reelection campaign, Trump wrote: “When tariffs cut in, many people’s income taxes will be substantially reduced, maybe even completely eliminated,” positioning tariffs as a return to 1890s-era prosperity when the US thrived without income tax, relying instead on import duties.
He followed up in June 2024, floating the full replacement of federal income tax with broad tariffs, stating the country was “richest” pre-income tax and vowing, “Yeah, sure, why not?” during a Joe Rogan interview shared widely on the site, while proposing exemptions for tips, overtime, and Social Security to ease burdens on workers.
Roots in Campaign Pledges Face Steep Hurdles
The proposal traces back to Trump’s April 2025 statements, where he linked 10-50% blanket import tariffs, imposed via emergency powers, to replacing income taxes amid stalled trade negotiations, including pauses on extreme rates like China’s 145% levies and exemptions for allies such as Brazil.
White House strategists are preparing contingencies for Supreme Court rulings that might deem tariffs unlawful, potentially forcing refunds exceeding $100 billion, while ongoing dialogues with Taiwan and the EU add layers of uncertainty to revenue streams.
Congress retains sole authority over taxes and trade, complicating execution; post-election Democratic gains amplify concerns over household affordability, with critics arguing the plan overlooks America’s $35 trillion debt and the mismatch between $3 trillion in annual imports versus $15 trillion in taxable income.
The Logical Indian’s Perspective
Ambitious fiscal overhauls like Trump’s underscore the urgency for policies steeped in empathy, prioritising the struggles of ordinary families across borders over provocative tariffs that risk escalating trade conflicts, inflating daily essentials, and widening inequalities.
The Logical Indian champions paths to harmony through open dialogue, kindness, and collaborative reforms that foster coexistence, shared prosperity, and sustainable growth rather than speculative revenue experiments laden with economic pitfalls.
🚨 BREAKING: President Trump confirms he might totally ELIMINATE the federal income tax
— Eric Daugherty (@EricLDaugh) November 28, 2025
This would be HUGE 👀
"Within the next couple years, we'll substantially be cutting – or cutting out COMPLETELY…income tax. Could be almost completely cutting it [because of tariffs]." pic.twitter.com/SNclF0Q5Pl
