Trump plans new tax cuts in an attempt to alleviate the burden of tariffs.
U.S. President Donald Trump said on Sunday that the broad tariffs he imposed could help him cut income taxes for individuals earning less than $200,000 a year, amidst rising public concern about his economic agenda.
Trump had previously argued that tariff revenues could replace income taxes, although economists have questioned these claims, according to Bloomberg.
Trump said on Sunday on his social network “Truth Social”: “When the tariffs go into effect, income taxes for many people will be significantly reduced, and may even be eliminated entirely. The focus will be on individuals earning less than $200,000 a year.”
In just a few weeks, the tariffs imposed by Trump disrupted the global economy, raised concerns about rising prices for Americans, and sparked warnings that his policies could lead to an economic recession.
A CBS News poll published on Sunday showed that 69% of Americans believe the Trump administration has not focused enough on lowering prices. The approval rating for Trump's handling of the economy in the poll dropped to 42% from 51% in early March.
Trump wants to extend the income tax cuts enacted in 2017 during his first presidential term, which are set to expire by the end of 2025. He also proposed expanding tax exemptions — including tips for workers and social security earnings — while reducing the corporate tax rate to 15% instead of 21%.
Treasury Secretary Scott Bicent responded to the poll results on Sunday by saying that American consumers are still spending, and that the administration is working on establishing bilateral trade agreements after Trump imposed what he called reciprocal tariffs on many countries in early April. He later froze these tariffs for 90 days for all affected countries except China.
Bicent said on the ABC network's “This Week” that the efforts involve 17 major trading partners, excluding China.
He added: “We have an existing process over the next ninety days to negotiate with them,” noting that “some of those negotiations are going very well, especially with Asian countries.”
Bicent repeated the administration's argument that Beijing will be forced to return to the negotiating table because China cannot bear the level of the latest U.S. tariff of 145% on Chinese goods.