Trump: We may almost completely eliminate income tax because of tariff proceeds

The federal government raises about $3 trillion a year from income taxes. The United States also happens to import around $3 trillion worth of goods annually. So that means tariffs would have to be at least 100% on all imported goods for the levies to replace income taxes, said Torsten Slok, chief economist at Apollo Global Management, in a note to investors.

The United States’ effective tariff rate now stands at 22.8%, according to Fitch Ratings. So to take the place of income taxes, tariffs would need to be more than four times higher than they are now — and America’s new tariff rate is already by far the highest of any developed country and has threatened to plunge the US and global economies into a recession.

But replacing all that tax revenue is not even as simple as doubling the price of everything that comes into America, Slok notes: As prices rise, demand trails off. That’s why America’s largest companies this earnings season have said that Trump’s trade policies are raising costs and leading consumers to spend less on practically everything — from airline tickets

“The math just doesn’t add up,” said Erica York, vice president of federal tax policy at the Tax Foundation. “Not even close.”

The tariffs already imposed and scheduled to take effect will bring in just $170 billion in annual revenue, the Tax Foundation estimates — taking into account reduced demand for goods that higher prices would create. That’s well short of the amount of federal income taxes America brings in each year.

He may almost eliminate income tax...for his billionaire buddies. The average US citizen won't get any relief at all. In fact, they'll just be paying higher prices to fund the tax cut for billionaires.

Someone should relieve him of his duties. Stark raving bonkers thing to say. He must enjoy embarrassing himself, his colleagues and his support base. There just comes a point where the lunacy of it all can't be ignored, excused, discounted or brushed away anymore.

The history of Income Tax in the USA is quite interesting.

From zero or verey minimal income tax on the citizens.
To the introduction of income tax to facilitate the Civil War costs.
(Taxes to fund wars. Who would have thought.)

Then zero income tax off & on & off again.
Till 1913
(Interestingly enough the very SAME year as the privately? owned Federal Reserve Bank came into existance)

Coincidences all, of course.



Anyways, some light reading for those that have the time
https://www.investopedia.com/article...tory-taxes.asp
https://www.stlouisfed.org/in-plain-...ose-of-the-fed

Thank God Trump is the President and not you.

Perhaps in the mercantile system that Trump is trying to re-create, more reminiscent of how things operated around the 15th to 18th centuries.

Yay for MAGA.

Bring it on .

100% tariffs

“We may almost completely eliminate”…. Confuse and contradict in 5 words. Don’t bother analysing this brain fart tweet. It ain’t happening.

Math was never his strong skill.

and that would mean imports weren't going down, and he wouldn't be bringing any jobs back.
No jobs and paying higher tariffs for Americans.

Tariffs can’t replace income taxes. You need tariffs to bring in trillions for that to be a conversation.

Hawkish

No longer shall the President be known as King Trump. Behold, God Trump. Friend of MBS - Mr Bone Saw.

Putin's dreams out of Trumps mouth.

This may trigger a mega short shock of US Bonds by the bond vigilantes. In other words, spikes in interest rates for loans and credits as risk premium.

Does anyone know if this little idiot is still blocking the releases of Job data? Pure corruption regardless

Glory to Donald Trump: the Great Conqueror of the World Trade and Liberator of Americans!