Trump Considers Replacing Income Taxes with Tariffs, Claims Economic Benefits

On Fox News, U.S. President Donald Trump stated that it is possible the revenue generated from tariffs could replace income taxes in the U.S.  

In an interview on Fox News broadcast on April 15, President Trump was asked by host Rachel Campos-Duffy if his tariffs could ultimately replace income taxes.  

Trump praised her question, noting that she was the only one who had raised this issue with him so far.  

"It's really possible. The revenue from tariffs could be so significant that it could replace income taxes. You know, back in the old days, around 1870 to 1913, tariffs were the only source of government revenue. That was when our nation was relatively wealthy. We were the richest country," Trump said.  

The White House leader was also asked how much money the U.S. could collect from his tariff rates.  

"Billions, billions to hundreds of billions of dollars a year. Before, I made a slight adjustment to lower the tariffs because it was a transitional period. We needed to be a little flexible. But we’re still bringing in 2 to 3 billion dollars a day. We’ve never made money like this," Trump explained.  

Trump, who calls himself the "Tariff Man," argued that his trade policies could generate over a trillion dollars next year, helping to reduce the national debt and possibly even replace income taxes. He claimed that tariffs are strengthening the U.S. economy and bringing in billions of dollars daily to the federal budget.  

However, economists are skeptical of these claims, warning that raising import prices could reduce consumer purchasing power.  

According to the Congressional Research Service (CRS), over the past 70 years, tariffs have contributed no more than 2% of the total federal revenue each year. In 2024, revenue from tariffs accounted for just 1.7% of the total over 4.9 trillion dollars in federal revenue.  

On April 9, President Trump announced a 90-day suspension of retaliatory tariffs on more than 75 countries/territories that have not retaliated against the U.S., except for China. During this 90-day period, these countries will face a 10% tariff as the Trump administration negotiates with them. China, however, will still face tariffs up to 145%.