Commerce Secretary Howard Lutnick revealed that when he asked President Donald Trump if the federal government could eliminate income taxes on all Americans making less than $150,000 a year if the Trump administration could balance the budget, Trump answered, “Sure.”
Lutnick appeared on the “All In” podcast, where he spoke about balancing the budget before speaking of Trump and income taxes.
“I’m in the car with him and I said we’re going to balance the budget,’ Lutnick recalled. “And I said, ‘But I have one favor to ask you: If we can balance the budget for you, will you agree to waive all income tax for every person who makes less than $150k a year in the United States of America?’ Which, by the way, is about 85% of Americans. And the reason you want to work for Donald Trump is he looks at me, he goes, ‘Sure.’ You realize, the President of the United States said, ‘If you balance the budget, sure.’ And he’s not lying; he’s not kidding. He’s like, ‘Yeah.’”
Commerce Secretary @howardlutnick says eliminating income taxes is a real possibility👀
“I’m in the car with [@realDonaldTrump] … I said ‘I have one favor to ask you, if we can balance the budget for you, will you agree to waive all income taxes for every person who makes less… pic.twitter.com/aDnXcY2KbN
— Trump War Room (@TrumpWarRoom) March 21, 2025
Lutnick launched into a history tour to explain how tariffs had worked in the past:
America was built on tariffs with no income tax. No income tax until 1913. None, greatest, richest country in the world. So when Donald Trump says, “Make America Great Again,” what he’s talking about is from 1880 to 1913, when the country had so much money that we had blue-ribbon commissions to try to figure out how to spend the money. And no income tax. Then we put in the income tax in 1913. Why? Because we’re entering World War I, and don’t we all need to contribute to protect democracy and protect our way of life?
Then what happens is the world goes into chaos; we come out of chaos, and then we’re starting to think, “Well, what do we do? What do we do?” And then in 1929 the stock market crashes. By 1933, we start to say, “Oh, whoa, whoa, God, we forgot. We need to do tariffs.’” 1933? How can you do tariffs when the market’s crashed, the world’s going into depression and you’re going to do tariffs in 1933. You can’t charge the rest of the world money unless the rest of the world’s okay. So it was too little, too late.
So then we come out of World War II. It’s 1945; we need to rebuild the world. So we decide we’re going to take our tariffs down, and we’ll let them — here’s the key — let them have tariffs be up and we will export the power of our economy to let them rebuild. And we let them rebuild. And that’s what happened. So in 1945 we have the Marshall Plan; and we do it in Japan, of course, cause they need to be rebuilt. What’s the difference. They need to be rebuilt.
And then what happens is we have the fifties, and we have the Korean War. So we let them rebuild, which means we have low tariffs here, high tariffs there. Then we have the Vietnam War. So now all of a sudden we have all of Southeast Asia. Low tariffs here, high tariffs there.
You know what’s the best example I can give you to make it crystal-clear? Kuwait. We spent almost $100 billion freeing Kuwait. You know who had the highest tariffs against the United States of America? The number one country with the highest tariffs against the United States of America? Kuwait.
