Trump Proposes Cutting Income Tax, Using Import Tariffs

U.S. President Donald Trump announced his intention to eliminate the federal income tax during a video call with military personnel on Thanksgiving 2025. He said revenue from import tariffs could replace the lost tax income.

Trump previously argued on Truth Social that import tariffs could largely offset income tax for taxpayers earning under $200,000 annually. Since early 2025 his administration has imposed new tariffs ranging from ten to fifty percent on most imports, with Indonesian goods now facing roughly nineteen percent after talks between President Prabowo Subianto and the White House.

If the tariffs remain, federal receipts are expected to be sufficient to service part of the roughly $37 trillion national debt and fund a $2,000 cash dividend for each citizen, although several Supreme Court justices have expressed doubts about the legality of the tariffs.