In a move that could reshape the financial landscape for the majority of Americans, U.S. Commerce Secretary Howard Lutnick has announced that President Donald Trump is aiming to eliminate federal income taxes for individuals earning less than $150,000 annually.
This ambitious proposal, hailed as a game-changer for the middle and working classes, signals a significant shift in tax policy aimed at putting more money back into the pockets of everyday Americans.
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Speaking to Fox News on Thursday, Lutnick revealed that Trump’s vision is to waive taxes for this income bracket once the federal budget is balanced, a goal that could provide unprecedented relief to households across the nation.
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“U.S. President Donald Trump would like to waive taxes for Americans earning under $150,000 once he balances the budget,” Lutnick told Fox News.
This statement underscores a commitment to fiscal responsibility paired with transformative tax cuts, a combination that has already sparked excitement among supporters.
The proposal builds on Trump’s broader economic agenda, which includes eliminating taxes on tips, overtime pay, and Social Security contributions—policies Lutnick described as “transformative ideas for America” in an interview with CBS News.
“I know what his goal is… no tax, for anybody who makes less than $150,000 a year,” Lutnick said, emphasizing that this is a priority he’s actively working to achieve. If realized, this plan could mark one of the largest tax cuts for the middle class in U.S. history, offering relief to millions struggling with rising costs of living.
The positive implications of this policy are already generating buzz. According to Newsweek, Lutnick outlined that these massive tax cuts would be balanced by cracking down on overseas tax fraud and implementing tariffs on foreign nations, ensuring that the burden shifts away from American taxpayers.
“Let them pay a membership fee,” Lutnick told CBS News, referring to foreign economies that benefit from U.S. consumption. This innovative approach promises to safeguard national finances while delivering tangible benefits to citizens.
For the average American, the impact could be life-changing. A single individual earning $150,000 currently falls into the 22% federal tax bracket, meaning they could save thousands of dollars annually under Trump’s plan.
This relief aligns with Trump’s earlier promises to renew his 2017 tax cuts and introduce policies like “no tax on tips and overtime pay,” further boosting take-home pay for workers in service and labor-intensive industries.
Reaction to the announcement has been overwhelmingly positive among Trump’s base. Social media platforms like X are abuzz with supporters calling it a “great move” and predicting it could become “one of the most popular pieces of legislation ever passed in American history.”
Economists and policy experts are also taking note, with some suggesting that the plan could stimulate consumer spending and bolster economic growth, particularly for small businesses reliant on middle-class customers.
Lutnick’s comments come at a time when the administration is navigating complex trade policies, including tariffs aimed at protecting American industries. Yet, the Commerce Secretary remains steadfast in his optimism.
“That’s what I’m working for,” he told CBS News, reinforcing his commitment to turning Trump’s vision into reality. The proposal dovetails with efforts to reduce government spending and address the fiscal deficit, ensuring a sustainable path forward.