Report: Trump's proposed tariffs would cost average American families $2,500 annually - TAI News
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Republican presidential candidate former President Donald Trump speaks with reporters at the National Republican Senatorial Committee, Thursday, June 13, 2024, in Washington. (AP Photo/Evan Vucci)

Former President Donald Trump’s idea of putting a blanket tariff on all imports would cost average American families $2,500 each year, as the tariffs would increase costs for necessary goods and services, according to a June 18 report from the Center for American Progress.

Trump’s repeated statements that he would put an automatic universal 10% tariff on all imported goods, as well as a tariff of up to 60% on imports from China, would lead to increased inflation, the CAP report found, costing a typical household $2,500 more per year for everything from food and pharmaceuticals to clothing and electronics.

Trump went a step further during a closed-door meeting with congressional Republicans on June 13, saying he wants to use tariffs to get rid of income tax in the United States, CNBC reported.

CAP reported that his plan to eliminate the federal income tax would be even more costly for American families.

First, in order for tariff revenue to fully replace income tax, tariffs would have to be well over the 10% Trump proposed.

“No tariff on the $3 trillion of goods imports entering the country each year could raise enough revenue to replace the $2 trillion the individual income tax raises annually,” CAP wrote in its report. “The tariff tax rate would have to be so high that it would cause the volume of imports to drop dramatically.”

And CAP said that eliminating the income tax in exchange for tariffs would amount to a tax increase for lower-income Americans and a massive cut for the top earners.

Currently, about 40% of households pay no income tax, so eliminating the income tax would not benefit them. Raising tariffs, however, would cause those households to pay more money through increased prices for necessary goods and services, amounting to a tax increase.

“Trump’s latest idea to replace all income taxes with tariffs is mathematically impossible, but even if it were feasible, it would dramatically increase income inequality and raise taxes for the bottom 90% of households,” CAP said.

Treasury Secretary Janet Yellen panned Trump’s idea.

“It would require tariffs well over 100%,” Yellen said in an interview on ABC’s “This Week” on June 16. “The impact would be to make life unaffordable for working-class Americans, and it would harm American businesses.”

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