Trump's Tariff Claims: The Reality Behind the Numbers
President Donald Trump has consistently expressed his strong support for tariffs, presenting them as a multi-faceted tool that serves various purposes. He portrays these tariffs not just as a means of generating revenue but also as a strategy to challenge nations he believes are taking undue advantage of the United States in trade negotiations. In fact, even Canada and Mexico have felt the brunt of his tariff policies, receiving substantial tax increases on goods imported from their countries.
On April 2, Trump made headlines by announcing significant new tariffs on nearly all trading partners. However, this announcement was met with swift backlash as the stock market responded negatively, prompting Trump to roll back most of these tariffs just a week later, on April 9.
Despite the tumultuous developments, Trump confidently asserts that tariffs are an enormous source of revenue for the United States, claiming during a speech at the National Republican Congressional Committee Dinner on April 8, Were making a fortune with tariffs. $2 billion a day. Do you believe it? I was told $2 billion a day.
Let's delve into the facts behind this assertion.
CLAIM: The U.S. is earning $2 billion per day from tariffs.
THE FACTS:
This claim does not hold water. Trump began implementing increased tariffs in February. That month, U.S. Customs and Border Protection reported that approximately $7.247 billion in customs duties were collected, which averages out to about $258.82 million per day. In March, the most recent monthly figures available, a total of roughly $8.168 billion was collected in customs duties, translating to around $263.48 million daily. It is important to note that customs duties are a specific type of tariff.
In a statement released on April 8, U.S. Customs and Border Protection revealed that due to 13 tariff-related presidential actions taken by Trump, the agency was collecting over $200 million in additional revenue daily. The agency holds the responsibility for collecting these tariffs.
When assessing the overall revenue generated from tariffs thus far in fiscal year 2025, which commenced on October 1 under the Biden administration, the latest numbers from the Treasury Department indicate that $56.215 billion in customs duties and certain excise taxes have been collected. This averages out to $283.91 million per day. Notably, an excise tax is also classified as a type of tariff.
As of this month, the U.S. has collected about $3.076 billion in customs and specific excise taxes, equivalent to approximately $180.94 million per day, as per the Treasury Departments data.
Economists suggest that Trump's claim of $2 billion daily revenue may be derived from the total value of imported goods in fiscal year 2024. This figure fails to consider how increased tariffs can alter supply and demand dynamics.
Robert Johnson, an associate professor of economics at the University of Notre Dame, remarked, Its almost certainly the case were collecting less than that, referring to Trump's $2 billion per day figure.
According to the Bureau of Economic Analysis, the U.S. imported approximately $3.3 trillion worth of goods in fiscal year 2024. If we apply the average tariff rate of 20% that Trump announced on April 2, this would suggest a potential revenue of $660 trillion worth of goods, which translates to around $1.8 billion in daily revenue.
However, economists caution that this calculation does not take into account potential behavioral changes. For instance, if tariffs increase and render a product less profitable, importers may choose to stop importing it altogether. Additionally, if consumers face higher prices due to increased tariffs, they may opt to forgo purchasing certain items.
Felix Tintelnot, an associate professor of economics at Duke University, indicated that Trumps optimistic estimate of $2 billion is unlikely to be accurate, stating, You cant do a calculation of expected tariff revenue off past trade flows and then multiply it by a currently applied tariff and expect that the past trade flow remains the same.
Ryan Monarch, an assistant professor of economics at Syracuse University, concurs, asserting that it is a flawed assumption to believe that purchasing habits will remain unchanged in light of new tariffs.
It's also crucial to understand that it is U.S. importersAmerican companiesthat ultimately bear the burden of paying these tariffs, rather than foreign governments. The funds collected go directly to the U.S. Treasury, and in most cases, these companies will pass on the increased costs to consumers, resulting in higher prices for everyday goods.
While tariffs can significantly impact foreign countries by making their products more expensive and difficult to sell in the U.S. market, foreign companies are often forced to reduce prices and sacrifice profit margins to offset the effects of the tariffs, attempting to maintain their market share within the United States.
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James Whitmore
