Imagine waking up one morning to a world where your paycheck stays fully in your bank account—no income tax deducted at all.
It sounds like a dream, almost too good to be true. But according to President Trump, the surge in tariff revenue from foreign imports might make this scenario a reality sooner than anyone expects. Could your tax-free future be closer than it seems—or is there more to the story than meets the eye?
Tariffs Could Pave the Way for Income Tax Cuts, Trump Says
On November 27, President Donald Trump stated that the United States might eliminate income taxes entirely in the next few years, thanks to the revenue generated by tariffs on imported goods.
Speaking during a Thanksgiving call with U.S. service members, Trump emphasized that tariffs have brought in massive amounts of money and encouraged companies to keep or relocate manufacturing to the U.S. to avoid extra costs.
“We’re taking in hundreds of billions of dollars like we’ve never done before. Some of that will go back to the American people as a kind of dividend, but much of it will be used to reduce national debt,” he said.
“Over the next couple of years, I believe we could significantly reduce—and possibly even eliminate—income taxes because the revenue coming in is going to be enormous.”
Earlier, on April 27, Trump had also suggested that Americans earning less than $200,000 annually could see their income taxes lowered or completely removed once the tariffs were in effect.
Tariff Revenue and Economic Impact
According to the Penn Wharton Budget Model, which relies on Treasury Department data, U.S. customs and excise tax collections reached over $320 billion as of November, up from about $171 billion at the same time in 2024.
Trump’s trade policies introduced a 10 percent baseline tariff on most imports, with some countries facing duties as high as 40 percent.
The Tax Policy Center reports that the 2025 tariff measures have increased the average U.S. tariff rate to 17.6 percent, projecting roughly $2.3 trillion in revenue from 2026 to 2035.
Next year alone, tariffs are expected to add about $256 billion to federal income, though the center notes this is uncertain due to complex stacking rules, foreign countermeasures, and broader economic effects. Tariffs could also raise costs for households by an estimated $2,200 on average.
Trump Predicts Tariff Revenues to Soar
On November 24, Trump posted on Truth Social that global buyers’ temporary stockpiling of imports to avoid tariffs was running out, meaning tariffs would soon apply to all purchases.
“Despite the massive revenue the U.S. is already generating, much more is coming. Stockpiled imports are diminishing, and tariffs will soon be fully paid on all applicable goods. This will be record-breaking and set the nation on an unprecedented path,” Trump said.
Conclusion
Trump’s statements suggest that tariff income could fundamentally reshape the U.S. tax system, potentially allowing for dramatic reductions—or even elimination—of income taxes in the coming years.
While the idea promises significant relief for taxpayers, experts caution that the full economic impact of tariffs remains uncertain, including potential effects on household costs and global trade. Americans may see major financial changes ahead, but only time will reveal how feasible these promises are.