U.S. Tariff Revenue Surges Amid Trump's Trade War
Despite many of the “Liberation Day” tariffs having been paused for the past three months while trade negotiations were ongoing, the tariffs that remained in effect, e.g. a 10-percent baseline tariff on nearly all U.S. imports, punitively high tariffs on Chinese imports and new tariffs on imports of steel, aluminum and passenger cars, were enough to send U.S. tariff revenue surging. According to data published by the Department of the Treasury, U.S. government receipts from customs duties and fees more than tripled between March and June, reaching an all-time high of $26.6 billion last month.
Three quarters through fiscal year 2025, which ends September 30, U.S. customs revenue has already reached $108 billion this year, exceeding the previous full-year record of $99.9 billion recorded in fiscal 2022. As our chart shows, U.S. tariff revenue increased notably during Trump's first stint in the White House as well, when the trade dispute with China resulted in receipts from customs duties doubling between 2017 and 2019. The Biden administration left many of the tariffs in place, resulting in consistently higher revenue from import duties since then.
With total government receipts from October through June amounting to $4.01 trillion, customs duties still account for less than three percent of federal government revenue, with individual income taxes, social security contributions and corporate income taxes accounting for the lion’s share (95 percent) of the total. Even in June, with tariff revenue at an all-time high, import levies accounted for no more than five percent of total receipts. This shows that generating additional income to support the budget is not the main objective of the Trump administration’s tariff offensive. Instead, Trump views high tariffs (or the threat thereof) as a bargaining tool, as he seeks to re-negotiate trade agreements on his own terms.
According to economists, this will likely happen at the expense of U.S. consumers, who are expected to bear the brunt of the additional tariff costs. Goldman Sachs estimates that consumers will shoulder 70 percent of the additional costs, while U.S. businesses and foreign exporters will each assume 15 percent of the tariff burden.