New Tariff System
President Trump has proposed a significant reduction or even complete elimination of U.S. federal income taxes once the new customs tariff regime is fully implemented. This could drastically reshape the U.S. economy and spark major debates on issues such as inflation and government spending. In this process, alternative assets, especially digital currencies like Bitcoin, could play a significant role.
The impact of tax cuts on the economy could be substantial. While government revenues may decrease, individuals and businesses are expected to gain more spending power. On the other hand, the rapid increase in government spending to finance tax cuts could lead to higher national debt and potentially higher inflation rates. This could cause volatility in financial markets. Additionally, if the government prints more money to finance its debts, this could affect the value of crypto assets.
Tax cuts and rising inflation could lead to an increase in the value of digital assets. However, if government spending and borrowing grow uncontrollably, market volatility may ensue.
