Commerce Secretary Comments On Income Tax Plan
If President Donald Trump’s plan to eliminate federal income taxes for Americans making under $150,000 annually comes to fruition, it could mark one of the most significant overhauls of the U.S. tax system in modern history.
Commerce Secretary Howard Lutnick laid out the administration’s vision this week, describing a tax structure that would shift the financial burden away from working Americans and onto foreign entities that benefit from U.S. economic power.
The strategy hinges on a fundamental shift in revenue collection—moving from domestic income taxes to tariffs and the closing of overseas tax loopholes. “His goal is to have external revenue,” Lutnick explained in an interview with CBS.
“The rest of the world leans on our economy, breathes off our economy.” He argued that since the U.S. is the world’s largest consumer market, it holds leverage over international trade partners who rely on American demand. Under this proposal, foreign nations would essentially pay a “membership fee” to access that market.
Trump’s vision isn’t limited to income tax cuts. He has also advocated for eliminating taxes on tips, overtime, and Social Security benefits, all of which disproportionately impact middle- and lower-income Americans. “These are the kinds of things that will change America,” Lutnick stated, underscoring the administration’s goal of lifting financial burdens on workers.
This idea isn’t entirely new. Trump has previously pointed out that the U.S. operated without an income tax until 1913, relying instead on tariffs to fund the federal government.
“Instead of taxing our citizens to enrich foreign nations, we should be tariffing and taxing foreign nations to enrich our citizens,” he declared earlier this year. By returning to that model, Trump believes the U.S. can quickly rebuild economic strength and financial independence.
The proposal aligns with Trump’s broader economic agenda, which includes renegotiating trade deals and imposing tariffs on nations like China, Canada, Mexico, and European countries. These measures, he argues, will not only generate revenue but also encourage companies to invest and manufacture within the United States.