Trump says he may cut income tax 'completely' due to tariff revenue

WASHINGTON, DC: President Donald Trump said on Thursday, November 27, that his administration may completely slash income tax over the next couple of years due to the government revenue generated from tariffs.

In early 2025, the POTUS announced tariffs on trading partners, which impose taxes ranging from 10 to 50 percent on most US imports, depending on their country of origin.

Trump's plan to eradicate income tax in near future

Trump told US military service members on a video call from White House on Thursday, "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."

The POTUS, however, did not share the specifics of his plans to nearly eliminate income tax. 

Interestingly, this is not the first time Trump has claimed that the imposition of tariffs will result in a significant decline in income tax for many Americans. 

He mentioned in a Truth Social post in April 2025, "When Tariffs cut in, many people’s Income Taxes will be substantially reduced, maybe even completely eliminated. Focus will be on people making less than $200,000 a year."

During the start of his second term as POTUS, Trump announced tariffs on trading partners depending on their country of origin. He also claimed that these tariffs would increase government revenue and encourage consumers to buy more American-made goods.

Moreover, he has often defended tariffs on trading partners, proposed a tariff dividend to Americans earlier in November. He also called out people who criticized tariffs and pledged a dividend of at least $2,000 per person. 

"People that are against Tariffs are FOOLS! We are now the Richest, Most Respected Country In the World, With Almost No Inflation, and A Record Stock Market Price. 401k’s are Highest EVER," Trump wrote in a Truth Social post.

He also promised dividends to Americans, saying, "We are taking in Trillions of Dollars and will soon begin paying down our ENORMOUS DEBT, $37 Trillion. Record Investment in the USA, plants and factories going up all over the place. A dividend of at least $2000 a person (not including high income people!) will be paid to everyone."

Trump predicts 'record-setting' tariff surge

President Trump said that the US is on the brink of a "record-setting" surge in tariff revenue, and argued that the true impact of his trade agenda has not yet been reflected in official data.

In a lengthy Truth Social post on November 23, the POTUS claimed that global buyers had initially "stocked up" on goods to avoid paying higher duties but said that strategy was now fading.

He wrote, "Despite the massive amount of money being made by the United States of America, hundreds of billions of dollars, as a direct result of tariffs being charged to other countries, the full benefit of the tariffs has not yet been calculated."

As per Trump, importers bought unusually large inventories to dodge tariffs in the short term. He mentioned, "Many of the buyers of goods and products, in order to avoid paying the tariffs in the short term, ‘stock up’ by purchasing far more inventory than they can use." 

"That heavy inventory purchase is now, however, wearing thin, and soon tariffs will be paid on everything they apply to, without avoidance," Trump added.

The POTUS added that he expects the amounts payable to the US government to "skyrocket, over and above the already historic levels of dollars received."