U.S. Secretary of Commerce Howard Lutnick appeared on Jesse Watters Primetime Wednesday, discussing President Donald Trump’s plan to dismantle the Internal Revenue Service (IRS) and restructure the country’s tax system.

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Lutnick explained that Trump’s vision involves eliminating the IRS and shifting tax burdens onto foreign businesses that currently operate in the U.S. without paying taxes.

This includes industries such as cruise lines and supertankers, which frequently register in foreign countries like Panama or Liberia to avoid U.S. taxation.

During his Fox News appearance, Lutnick described how these foreign-registered companies take advantage of loopholes to bypass American tax laws.

Howard Lutnick speaks at Capital One Arena in Washington, D.C., on Monday, Jan. 20, 2025 for President Donald Trump’s inauguration.

He highlighted how Trump intends to change this system to relieve financial pressure on American citizens.

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“His goal is to abolish the Internal Revenue Service and let all the outsiders pay. I mean, this is someone who is focused on America. Let’s drive down our waste, foreign abuse,” Lutnick said.

He gave examples of industries that currently escape taxation, particularly within the maritime and alcohol sectors.

“I’ll give you an example, cruise ships. You ever see a cruise ship with an American flag on the back? They have flags of Liberia or Panama. None of them pay taxes. Every supertanker, none pays taxes. Alcohol, all foreign alcohol, no taxes,” Lutnick explained.

According to Lutnick, Trump’s initiative would not only target tax-avoiding foreign businesses but also work toward balancing the U.S. budget while cutting personal tax rates for Americans.

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“This is going to end under Donald Trump, and those taxes are going to be paid, and Americans’ tax rates are going to come down. That’s what Donald Trump wants to do. Balance our budget and cut our taxes,” Lutnick said.

“I mean, imagine a Democratic senator going against that. What planet are these people on? Well, you’re saying French.”

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Following Trump’s return to office, scrutiny of the IRS has intensified.

Reports indicate that Elon Musk’s Department of Government Efficiency staffer, Gavin Kliger, recently arrived at IRS headquarters to assess the agency’s operations.

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According to insiders, Kliger has requested detailed reports on the IRS’s functions, 90-day operational plans, and current risks within each business unit.

Public sentiment toward the IRS has remained low. A July Pew Research poll found that the agency is the least favored federal institution, with 50% of Americans holding an unfavorable view.

Republicans, in particular, have criticized the IRS for alleged political bias, citing past instances of increased scrutiny toward conservative tax-exempt groups.

In 2017, the IRS issued a formal apology for subjecting conservative organizations, such as Linchpins of Liberty, to excessive delays and unnecessary requests for information.

The controversy added to Republican concerns over the agency’s role in targeting right-leaning groups.

Conservatives also pushed back against former President Joe Biden’s plan to expand the IRS significantly.

Under Biden’s administration, the IRS was slated to add 87,000 new employees over a decade, a move that drew sharp criticism from Republican lawmakers.

Danny Werfel, Biden’s appointed IRS commissioner, had aimed to increase the agency’s workforce to 100,000 in April as part of a modernization initiative.

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However, after Trump assumed office, Werfel resigned from his position, signaling a shift away from the previous administration’s expansion efforts.

Trump’s plan to eliminate the IRS altogether represents one of the most drastic tax reforms in American history.

As his administration moves forward, further details on the restructuring of the tax system are expected to emerge.

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