“And as time goes by, I believe the tariffs paid for by foreign countries will, like in the past, substantially replace the modern day system of income tax, taking a great financial burden off the people that I love.” —Trump
It’s not true that foreign countries pay tariffs. We pay tariffs, American businesses pay tariffs, and then they pass the cost onto us, the consumers, in the form of higher prices. That’s number one.
Number two, there was a time about 130 years ago when the United States did not have income tax and collected most of its revenue in the form of tariffs.
It was called the Gilded Age, and it’s one of the periods of the worst income inequality in the United States. Tariffs shifted the tax burden away from the rich and onto the poor, because everybody pays the same price for a good or service, regardless of how much money they have. So the tariff baked into that price is a larger burden for poor people than rich people.
And when the United States did establish income tax in 1913, we established marginal tax, which means the more money you make, the higher share of your income you pay in taxes. That was intended to shift the tax burden away from poor people and more toward rich people.
So what the president is saying is he wants to go back to a time when tariffs were the main revenue source and not income tax, and that would shift the tax burden away from the people he loves the most—rich people. He’s literally saying it out loud.
Just a reminder that it is Congress that has the power to establish or take away income tax. And this year, there is an election for all 435 members of the House and one third of the Senate. So the vast majority of Congress is up for election this year. So if you aren’t a rich person and you don’t want to live in a country where suddenly you have to pay a larger share of the tax than rich people, then you might want to pay attention to who you’re voting for this year.
If someone is saying that they want to go away from income tax and go back to tariffs, it’s code for taking the tax burden away from rich people and giving it to poor people.
Ben Sheehan is a political commentator and digital creator. He specializes in civics education, which is showcased in his latest book, What Does the Constitution Actually Say?: A Non-Boring Guide to How Our Democracy Is Supposed to Work. Check out his Substack, Politics Made Easy.
