Trump Plans Income Tax Elimination for Sub-$150K Earners If Budget Balanced

Commerce Secretary Howard Lutnick announced that President Donald Trump is considering eliminating federal income taxes for households earning less than $150,000 a year, contingent on successfully balancing the budget. This proposal, which would benefit approximately 85% of Americans, aligns with Trump's tariff strategy aimed at replacing income tax revenue. Critics, including tax attorney Thomas J. Cryan, warn that the reliance on tariffs could lead to increased prices on essential goods, potentially harming middle-class families. Lutnick emphasized the historical context of tariffs in the U.S., noting that the country operated without an income tax until 1913. The administration has already implemented tariffs on imports from China, Mexico, and Canada, which could further impact consumer prices. There is skepticism about the feasibility of such sweeping tax changes and their implications for the economy.