Trump Working To Abolish Income Tax And Replace IRS With External Revenue System
President Donald Trump is pushing to eliminate the income tax and replace the IRS with a new system that collects government revenue through tariffs instead of taxing American workers, according to U.S. Commerce Secretary Howard Lutnick.
During an interview on Fox News, Lutnick explained Trump’s plan to shift the burden of federal revenue away from U.S. taxpayers and onto foreign countries and organizations. The proposed External Revenue Service (ERS) would generate money for government expenditures by increasing tariffs rather than collecting income taxes.
“Wouldn’t it be amazing to stop paying taxes to the Internal Revenue Service and have the External Revenue Service of Make America Great Again replace our taxes?” Lutnick said. “That’s the goal of Donald Trump, and I think he’s going to hit there. He’s going to do everything he can to make that happen.”
Lutnick also emphasized Trump’s broader tax-cutting efforts, highlighting proposals to eliminate taxes on overtime pay, tips and seniors’ income. “Lower our taxes. No tax on tips. No tax on overtime. No tax on seniors,” Lutnick said. “Come on. This is an amazing country and we are winning.”
Trump has long criticized the IRS and pushed for tax reform, making major cuts to individual and corporate taxes during his first term. His latest proposal would mark the most dramatic shift in federal tax policy in modern U.S. history.
While details on the ERS remain unclear, Trump’s administration has increasingly focused on using tariffs as an economic tool, arguing that other countries should contribute more to U.S. government funding.
