Former President Donald Trump has again suggested his wildest tax reform plan - fully removing federal income taxes and saying that the lost revenue can be replaced by funds received from tariffs.
Appearing at a barbershop in the Bronx on Monday in a segment broadcast on Fox News, Trump was asked when the country could end all federal taxes. The former president suggested returning to the policies of the 1800s.
“It had all tariffs — it didn’t have an income tax,” Trump said. “Now we have income taxes, and we have people that are dying. They’re paying tax, and they don’t have the money to pay the tax.”
Similarly, in June, Trump suggested that federal income taxes be replaced by funds obtained via tariffs, something he has not explained further.
Experts on both sides of the aisle have criticized his ideas as mathematically unworkable and damaging to the economy, The New York Times noted. Legislators are unlikely to end the income tax even if Republicans gain control of Congress, even as tariffs and tax cuts have been some of the top issues pushed by Trump.
“There is a way if what I’m planning comes out,” Trump said about removing federal income taxes.
The Institute on Taxation and Economic Policy, a liberal think tank, found that Trump’s plans would raise the tax burden on lower-income Americans, cut taxes for the wealthy and significantly add to the deficit.
Meanwhile, Congressional Republicans are working on tax plans to pass sweeping changes as soon as the new Congress is sworn in next year if they win majorities in both chambers and if Trump manages to win back the White House. GOP leaders are laying the groundwork for Trump’s first 100 days of his second term, set to take quick action to pass a budget reconciliation package to enact tax cuts worth trillions.
Staffers working for Senate Republican Leader Mitch McConnell, Senate Republican Whip John Thune, who’s is in the running to replace McConnell, Speaker Mike Johnson, and House Majority Leader Steve Scalise recently met to discuss plans for the next Congress if the GOP wins the trifecta, according to The Hill.
Johnson has said that he plans to attempt to remain as speaker if the Republicans keep the House and he has been in frequent contact with Trump, while Scalise has said he has spoken to the former president about his top issues should he win.
The Republicans are hoping to pass a massive border security package, which would allow for the completion of Trump’s border wall and would possibly move to defund certain parts of the federal government that Trump and his allies argue have become weaponized by Democrats.
One of the top issues for a new Republican Congress would be to extend the 2017 Tax Cuts and Jobs Act before its 2025 expiration date.
“The plotting, the strategizing and trying to get prepared for [budget] reconciliation has been going for several months,” a Senate Republican aide said, according to The Hill.
“Over the August recess and over this October recess, those efforts have been ramping up a lot. McConnell’s folks and Thune’s folks have been leading the effort on our side,” the aide told the outlet.
“A lot of the House committees have been putting work in on this – some are further along than others,” they said. “Efforts are underway. Hitting the ground running is something everyone wants to be able to do.”
Senator John Barrasso told The Hill that he has been meeting with those in charge of Trump’s transition team to plan for the first 100 days of the next possible Republican administration.
Johnson spoke to Senate Republicans over the summer about passing tax cuts, spending cuts, and regulatory reforms. The package would pass under the Senate’s budget reconciliation process to avoid being thwarted by filibustering Democrats.
This summer, Texas Senator John Cornyn, who’s also running to replace McConnell, said Johnson was “pretty clear that they want to try to go big, and that means more than just extending the tax cuts,” according to The Hill.
