Donald Trump is once again making headlines with one of his boldest economic proposals yet: eliminating federal income tax for American citizens. His pitch sounds simple—stop taxing U.S. workers and start funding the government by taxing foreign imports instead. It’s a dramatic vision, and it has sparked equally dramatic debate.
A Campaign Idea With Big Appeal—But Even Bigger Questions
During the 2024 campaign, Trump repeatedly highlighted a future where taxpayers never file income taxes again. Instead, he imagines a streamlined system powered entirely by tariff revenue. On stage, it’s a crowd-pleaser: no IRS forms, no April deadlines, more take-home pay. But when you leave the rally and look at the numbers, the picture changes fast.
The Math Doesn’t Come Close to Adding Up
Federal income tax isn’t just one part of the budget—it’s the majority of it. More than half of all federal revenue comes from individual income taxes. Tariffs, on the other hand, bring in less than 4%. Even during periods of unusually high tariffs, revenue has never come close to replacing the nation’s primary funding source. Economists on both sides of the aisle agree: replacing income tax with tariffs would require an economic miracle that doesn’t exist on any calculator.
What Happens When Tariffs Rise? Prices Do Too
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