From the Desk of Attorney Omar Zambrano: Helping 10,000 Families Become Debt-Free in 2025
In a historic move, President Donald Trump has proposed abolishing the IRS and eliminating federal income taxes altogether. This radical shift would replace income taxes with tariffs and a national consumption tax, fundamentally changing how the U.S. government collects revenue.
The proposal, linked to the Fair Tax Act of 2025, aims to eliminate the Internal Revenue Service (IRS) and transition the country toward a tariff-based revenue system. Trump also proposes the creation of the External Revenue Service (ERS), which would focus on collecting tariffs from foreign goods rather than taxing American citizens.
With Congress now taking the proposal seriously, this could become the most dramatic tax reform in U.S. history. But how realistic is it? Would replacing income tax with tariffs actually work? And what impact would this have on inflation, the economy, and your finances?
Why Is Trump Pushing to Abolish the IRS?
Trump’s tax reform proposal is based on four major goals:
✔ Eliminating Federal Income Taxes – No more paycheck deductions for individuals or businesses.
✔ Taxing Foreign Nations Instead of U.S. Citizens – Shifting the tax burden to tariffs on imports rather than taxing wages.
✔ Simplifying the Tax Code – Ending the 2,000+ page federal tax code that confuses millions of Americans every year.
✔ Boosting Economic Growth – Giving workers and businesses more take-home pay to stimulate spending and investment.
Trump has argued that Americans shouldn’t be paying high taxes when the government wastes money and sends billions overseas. Instead, foreign companies doing business in the U.S. should be taxed.
How Would the Government Replace Income Tax Revenue?
Abolishing income taxes would eliminate the $5.1 trillion collected annually by the IRS. That revenue must be replaced with something else. Trump’s proposal includes:
✔ Tariff-Based Taxation – Higher import taxes on foreign goods would generate revenue. ✔ National Consumption Tax – Instead of taxing wages, the U.S. could introduce a federal sales tax on goods and services.
✔ Government Spending Cuts – Reducing federal spending to offset revenue losses.
✔ Shifting IRS Operations to the ERS – A new External Revenue Service would focus on tariff collection instead of individual audits.
Could Tariffs Replace the Income Tax?
Here’s the problem: the math doesn’t quite add up.
✔ In 2024, the IRS collected $5.1 trillion in taxes.
✔ In 2022, the U.S. imported $3.35 trillion in goods, generating only $11 billion in tariffs. ✔ To fully replace income tax revenue, tariffs would have to increase by 130% on ALL imported goods.
That means everything imported into the U.S. – from electronics to clothing to food – would be taxed at extremely high rates. This would result in higher consumer prices across the board.
✔ Less Imports = Less Tariff Revenue – If tariffs drive companies to move production back to the U.S., fewer imports would be taxed, reducing revenue.
✔ Would Spending Cuts Cover the Gap? – The government may need to slash social programs, defense spending, and federal jobs to make up the shortfall.
While Trump’s plan sounds appealing in theory, the economic feasibility remains uncertain.
How Much Would Americans Save Without Income Tax?
If Trump eliminates federal income tax, the average American would keep significantly more of their earnings. Let’s break it down:
Example: Someone Making $100,000 Per Year
Current Tax Situation (Before Trump’s Plan)
Under Trump’s Plan (No Federal Income Tax, Tariff-Based System)
Savings: Over $12,650 per year—which could be invested, spent, or saved.
How Would Americans Use Their Tax Savings?
✔ More Investment in Stocks & Real Estate – More Americans would invest in assets, boosting economic growth.
✔ More Consumer Spending – Retail, restaurants, and entertainment industries could see a surge in spending.
✔ More Savings & Debt Reduction – Families struggling with debt could use this money to pay off loans faster.
✔ Better Retirement Planning – People could contribute more to 401(k) and IRA accounts.
For many middle-class families, the extra $10,000–$20,000 per year in tax savings could be life-changing.
Will This Plan Cause Inflation?
There are two sides to the debate:
✔ Proponents argue that ending income tax will put more money in people’s pockets, helping the economy.
✔ Critics say higher tariffs will increase costs for consumers, driving up inflation.
What happened the last time the U.S. increased tariffs?
✔ In 2018, Trump placed a 25% tariff on steel imports.
✔ Steel prices initially rose, but later fell as companies adjusted.
✔ It’s unclear whether tariffs on ALL goods would have the same effect.
Inflation could rise or stabilize, depending on how businesses handle the new tax structure.
Final Thoughts from Attorney Omar Zambrano
Trump’s plan to abolish the IRS and move to tariff-based taxation is one of the most radical tax proposals in U.S. history. If passed, it could reshape government funding, raise consumer prices, and change how Americans handle personal finance.
The debate over taxation, inflation, and economic stability will continue, but one thing is clear: understanding financial changes is critical to protecting your future.
If you’re concerned about rising costs, debt, or how policy changes could affect your financial situation, we’re here to help.
How We Can Help: Financial Planning for a Changing Economy
📌 Debt Relief – We negotiate with creditors to lower balances and reduce interest rates.
📌 Foreclosure Prevention – Legal strategies to help you keep your home.
📌 Bankruptcy Assistance – Guidance through Chapter 7 & Chapter 13 bankruptcy.
📌 Asset Protection – Protect your home, savings, and assets from creditors.
📞 Call us at (626) 338-5505
🌐 Visit OmarZambrano.com
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📍 12738 Ramona Blvd, Baldwin Park, CA 91706
💥 Free Consultations Available
Attorney Omar Zambrano
Helping 10,000 Families Achieve Debt-Free Futures in 2025.
This is solely my opinion and should not be considered legal advice.
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