President Donald Trump is once again shaking up conventional thinking in Washington—this time by floating a bold new vision for America’s tax system. In a recent interview, Trump proposed that tariffs on foreign imports could eventually generate enough revenue to replace the federal income tax altogether.
“There’s a chance the money from tariffs could be so great that it would replace the income tax,” Trump said, pointing to a historical precedent from 1870 to 1913, when tariffs were the primary source of federal revenue before the establishment of the IRS and the income tax.
Under Trump’s plan, a new agency—the “External Revenue Service”—would take over much of the collection responsibilities currently handled by the IRS. Instead of taxing the income of hardworking Americans, the government would fund its operations by taxing foreign products entering the U.S. market. The goal: shift the tax burden from citizens to foreign companies profiting off American consumers.
The idea is consistent with Trump’s broader “America First” economic vision—protecting domestic industries, punishing foreign cheaters, and restoring American sovereignty over trade and taxation. Trump has already enacted sweeping tariffs as part of his Liberation Day trade initiative, and his administration says the numbers prove the concept is viable.
However, critics from the D.C. establishment and some in the economic elite have expressed skepticism, claiming the U.S. would need to generate upwards of $3 trillion annually to fully replace current income tax revenue. To do so, some analysts argue tariffs would have to reach over 100% on all imports—an unlikely scenario under traditional trade models.
But the Trump team isn’t following old rules. Officials close to the administration say that combining targeted high tariffs with economic growth, energy independence, and reductions in federal waste could dramatically shift the math.
They also argue that fears of consumer price hikes are overstated, pointing to recent examples where tariff-driven reshoring has actually lowered costs and boosted domestic job creation. “Every time Trump raises tariffs, American manufacturers come back, prices stabilize, and we reduce our dependency on adversaries like China,” said a senior advisor.
Opponents, mostly from the Left and globalist trade circles, warn that escalating tariffs could trigger retaliation from foreign governments and disrupt international supply chains. But Trump supporters see it differently—calling it long-overdue leverage in a system where America has been taken advantage of for decades.
Whether or not the full elimination of the income tax is immediately feasible, the idea has struck a chord with many Americans—especially working- and middle-class voters who are tired of seeing their paychecks shrink while billion-dollar corporations and foreign competitors skate by.
Trump’s tariff vision represents not just a policy shift—but a philosophical one: that government should serve the people, not punish them. And if tariffs can fund Washington instead of income taxes, many Americans are saying: why not?
As the 2026 budget fight looms, the Trump administration’s message is clear—American workers deserve relief, and it’s time foreign profiteers paid their fair share.
.@POTUS: “There is a chance that the money from tariffs could be so great that it would replace” the income tax. pic.twitter.com/SCBIOPD4zZ
— Rapid Response 47 (@RapidResponse47) April 15, 2025