Reportedly, the former president and Republican presidential candidate raised the notion in a recent private meeting, as sources informed CNBC. Speaking to Republican lawmakers at the Capitol Hill Club in Washington, D.C., Trump discussed the possibility of implementing an “all tariff policy” to eliminate income tax. He also hinted at using tariffs as leverage in negotiations.
“In 2023, the federal government collected over $2 trillion from individual income taxes alone,” he shared. “Nevertheless, punitive tariffs from foreign governments and increased costs may be passed on to individual taxpayers.”
According to Harpaz, the main concern is that this policy may not benefit most Americans. He explained, “The federal income tax is designed to be progressive, but an all-out tariff approach could have regressive effects, burdening lower and middle-income earners while favoring higher-income individuals and corporations.”
Several voices have voiced opposition to replacing the federal income tax with tariffs. David Kamin, a professor at New York University School of Law, remarked, “The income tax, flawed as it may be, generates around $2.5 trillion annually in a progressive manner.” He also stated that switching to tariffs would disproportionately impact lower and middle-income Americans.
Trump has recently suggested tariffs as a solution to various issues, such as immigration. In a recent event in Arizona, a state deeply concerned with immigration matters, Trump indicated that he might impose tariffs on countries failing to control illegal immigration into the U.S., including China if he were to be reelected.
“We have substantial economic leverage,” he stated. If given another term, he expressed intentions to impose tariffs on countries not addressing immigration issues adequately.