President Donald Trump has reignited one of his most ambitious economic ideas: eliminating federal income tax for American citizens and replacing it entirely with revenue generated from tariffs on foreign goods. While he expressed this concept frequently during his 2024 presidential campaign, his recent remarks suggest that the idea has moved from campaign rhetoric into a proposal he now wants to advance during his time in office.

Speaking during a Cabinet meeting and in recent interviews, Trump framed the idea as a sweeping transformation of the U.S. tax system—one that, according to him, could be achievable “in the not too distant future.” His vision is rooted in a broader argument that the United States should fund its government primarily through tariffs rather than through taxes on citizens’ wages.

### A return to an older system
During his campaign, Trump often cited the earlier periods of American history when tariffs were the primary source of federal revenue. He has repeated the idea that relying on import taxes, rather than taxing personal income, made the country more prosperous and allowed American workers and industries to thrive.

“It’s time for the United States to return to the system that made us richer and more powerful than ever before,” Trump said in earlier remarks, emphasizing that foreign producers should bear more of the financial burden of supporting the U.S. government, rather than American workers.

When asked by podcaster Joe Rogan whether he was serious about eliminating personal income taxes, Trump responded simply: “Yeah, sure, why not?” He argued that tariffs could be increased to levels that would generate sufficient revenue to cover government operations.

### A goal he says is within reach
In his recent Cabinet meeting, Trump expanded on the concept, suggesting that the federal income tax could be reduced dramatically or even eliminated entirely. “Whether you get rid of it or just keep it around for fun or have it really low, but you won’t be paying income tax,” he said, reiterating that revenue from tariffs could eventually offset the need for income taxes.

Trump highlighted what he described as strong tariff revenues already being collected and suggested that these funds could rapidly accelerate with more aggressive policies. “The money we’re taking in is so great, it’s so enormous, that you’re not going to have income tax to pay,” he claimed.

This outlook represents one of the most dramatic tax overhauls proposed in modern U.S. history. While he has previously suggested eliminating income taxes for individuals earning under $150,000, exempting tips from taxation, and removing federal taxes from car loan payments and Social Security benefits, Trump’s latest statements go further—implying a full removal of the federal income tax itself.

### The numbers tell a different story
While Trump’s proposal has generated a wave of excitement among supporters who favor lower taxes and reduced government involvement in personal finances, many economists and tax experts argue that the math behind the idea is far more complicated than it might appear.

According to data from the U.S. Treasury Department, individual income taxes accounted for more than half of all federal revenue in the most recent fiscal year. Tariffs, by comparison, generated a small fraction—just under 4% of total revenue. Even during years with higher tariff levels, such as 2024, the numbers remained far from sufficient to match the revenue from income taxes.

Economists caution that replacing a revenue stream that makes up more than 50% of federal funding with one that currently represents only a few percentage points would require either unprecedented tariff increases or major reductions in federal spending. Brandon DeBot, a senior attorney adviser and policy director at New York University’s Tax Law Center, stated that the proposal is not mathematically feasible under present conditions.

Analysts across the political and economic spectrum share similar conclusions. Even with significant tariff hikes, import activity tends to decline as prices rise, which reduces revenue and can lead to disruptions in domestic markets. “It’s not possible. It’s not feasible mathematically or economically,” DeBot said.

### Economic and legal uncertainties
Beyond the revenue gap, tariffs come with economic side effects that experts say must be considered. Higher import taxes often lead to increases in consumer prices, since companies that rely on foreign goods pass the cost along to buyers. Because lower-income households spend a larger portion of their earnings on goods, tariffs can disproportionately affect them—making tariffs effectively regressive.

There is also the matter of international responses. When one country imposes steep tariffs, other nations often retaliate with their own trade barriers, which can affect American exports. Such retaliatory cycles can lead to reduced trade, slower economic growth, and increased uncertainty for businesses.

The legal dimension adds another layer of complexity. The U.S. Supreme Court is currently reviewing challenges to presidential tariff authority, brought forward by major businesses including Costco. If the Court curtails the president’s ability to unilaterally impose new tariffs, Trump may need Congressional approval for sweeping changes—something that would likely spark extensive debate.

Even with potential legal limitations, Trump has indicated he could rely on older statutory powers, including emergency authorities or trade laws dating back to the Great Depression, to continue implementing tariff policies.

### Support, skepticism, and what comes next
The idea of eliminating income taxes is naturally popular with many Americans who associate the federal income tax with financial stress and government overreach. The prospect of keeping more of their earnings is appealing, and the simplicity of a tax-free paycheck resonates with those who favor limited taxation and smaller government.

However, economists argue that the transition from the current system to a tariff-based model would require a fundamental restructuring of the U.S. economy. Everything—from the cost of everyday goods to the health of international trade relationships—would be affected. The U.S. has not relied primarily on tariffs since the early 20th century, and today’s globalized economy operates in a vastly different environment.

Supporters of Trump’s proposal see it as a bold reimagining of American financial policy—one that could strengthen domestic manufacturing, reduce reliance on foreign goods, and bring jobs back to the United States. Critics contend that the proposal oversimplifies complex revenue and trade dynamics and may lead to higher consumer costs and economic instability.

For now, Trump has not released a formal legislative plan outlining how income tax elimination would be structured, phased in, or replaced. Without detailed figures or a clear roadmap, the proposal remains an ambitious long-term goal rather than a near-term policy shift. Still, his repeated emphasis on the concept suggests it will remain a key feature of his economic agenda.

Whether the idea becomes a transformative policy or remains a symbolic vision will depend on a combination of economic conditions, political dynamics, legal authority, and the ability to reconcile the realities of federal revenue with public expectations.

What is clear is that Trump’s comments have reignited a national conversation about taxation, trade, and the future direction of American economic policy—a conversation that is likely to continue as the administration develops its broader financial agenda.